Sour Squeeze: Brazil’s Orange Harvest Hits 36-Year Low.

In Bonn, on May 16, 2024, a startling update emerged from Brazil, the titan of orange juice production, which supplies 80% of the EU’s demand. The forecast for the 2024/2025 season revealed a drastic 25% drop in orange yield, marking the most severe shortfall since 1988.

Brazil’s orange output has been on a downward trajectory, depleting reserves and tightening orange juice concentrate availability. Fundecitrus predicts the upcoming season will continue this trend with a 25% decrease from the prior year’s already low figures. This equates to a staggering 1.7 billion liters less, translating to about four liters fewer per European Union inhabitant. To put it into perspective, the average German consumed 6.8 liters of orange juice in 2023.

The forecasted dip to the lowest point in harvests since the late '80s is attributed to climate change, with the El Ni?o weather pattern wreaking havoc on the Brazilian citrus belt. The recent season’s extreme heat and water scarcity during the critical flowering phase have drastically reduced fruit counts per tree, continuing a decline that began in 2020.

Compounding the issue is citrus greening, a lethal disease ravaging 40-80% of Brazil’s orange trees. Despite the dwindling supply, global orange juice demand remains robust, driving raw material prices sky-high. In Germany, the scarcity of orange juice concentrate is dire, with prices on commodity exchanges soaring up to 150% since early 2022. This price surge is expected to persist, as revamping Brazil’s citrus sector is a time-intensive and costly endeavor.

German juice manufacturers are striving to maintain a diverse, high-quality product range through innovation, despite the steep climb in raw material and logistics costs. These increases, impacting more than just the juice industry, signal inevitable price hikes for German consumers. The industry faces a crossroads: either pass these costs to consumers or innovate the product lineup, potentially diluting juice content in favor of more affordable options.

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Mostafa Adel

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