Investing.com - Orange juice futures were down heavily on Thursday, adding to the previous day’s 9.5% plunge as investors awaited further details regarding a government testing for a fungicide that has been found in low levels in orange juice.
On the ICE Futures Exchange, orange juice for March delivery traded at USD1.8105 a pound during European afternoon trade, tumbling 3.68%.
It earlier fell by as much as 3.84% to trade at a session low of USD1.8075 a pound. Prices rallied to a record USD2.0772 on Tuesday.
Sentiment in the orange juice futures market has been dominated this week by the discovery of low levels of the fungicide carbendazim in juice from the 2011 orange crop from Brazil.
Late Wednesday, beverage giant Coca Cola, which owns the Simply Orange and Minute Maid brands, said it was the company which notified the U.S. Food and Drug Administration of the discovery in late December. Both brands contain juice concentrate from Brazil.
Carbendazim is used to control mold in fruit and other crops, but at high levels can cause cancer, researchers said. The U.S. does not allow its use.
The FDA said it has temporarily halted shipments of orange juice from all countries as they are being tested and said it would destroy or ban products containing even low levels from a banned fungicide.
The testing will be complete in mid-January, an FDA spokeswoman said.
Brazil accounts for about half of all orange juice products imported into the U.S., making it the second largest supplier after Florida.
Prices soared 9.7% to an all-time high on Tuesday amid the uncertainty about whether orange supplies will be affected by the testing program, only to give back nearly all the gains on Wednesday, tumbling 9.5%, as traders speculated fears of an import ban on Brazilian juice were overblown.
The orange juice futures market is especially volatile, in large part because it is a small market compared to other commodities. It is the smallest agricultural market on the ICE Futures exchange, resulting in thin liquidity and low trading volumes which exaggerate price action.
Big moves at this time of the year are common as traders speculate on the likely impact of cold weather on the Florida orange crop. In January 2009, prices spiked up 7% on one trading day amid fears over crop damage, then plunged 13% the following day as concerns eased.
Elsewhere, on the ICE Futures Exchange, cotton futures for March delivery eased up 0.17% to trade at USD 0.9703 a pound, while sugar futures for March delivery rose 0.3% to trade at USD0.2379 a pound.
On the ICE Futures Exchange, orange juice for March delivery traded at USD1.8105 a pound during European afternoon trade, tumbling 3.68%.
It earlier fell by as much as 3.84% to trade at a session low of USD1.8075 a pound. Prices rallied to a record USD2.0772 on Tuesday.
Sentiment in the orange juice futures market has been dominated this week by the discovery of low levels of the fungicide carbendazim in juice from the 2011 orange crop from Brazil.
Late Wednesday, beverage giant Coca Cola, which owns the Simply Orange and Minute Maid brands, said it was the company which notified the U.S. Food and Drug Administration of the discovery in late December. Both brands contain juice concentrate from Brazil.
Carbendazim is used to control mold in fruit and other crops, but at high levels can cause cancer, researchers said. The U.S. does not allow its use.
The FDA said it has temporarily halted shipments of orange juice from all countries as they are being tested and said it would destroy or ban products containing even low levels from a banned fungicide.
The testing will be complete in mid-January, an FDA spokeswoman said.
Brazil accounts for about half of all orange juice products imported into the U.S., making it the second largest supplier after Florida.
Prices soared 9.7% to an all-time high on Tuesday amid the uncertainty about whether orange supplies will be affected by the testing program, only to give back nearly all the gains on Wednesday, tumbling 9.5%, as traders speculated fears of an import ban on Brazilian juice were overblown.
The orange juice futures market is especially volatile, in large part because it is a small market compared to other commodities. It is the smallest agricultural market on the ICE Futures exchange, resulting in thin liquidity and low trading volumes which exaggerate price action.
Big moves at this time of the year are common as traders speculate on the likely impact of cold weather on the Florida orange crop. In January 2009, prices spiked up 7% on one trading day amid fears over crop damage, then plunged 13% the following day as concerns eased.
Elsewhere, on the ICE Futures Exchange, cotton futures for March delivery eased up 0.17% to trade at USD 0.9703 a pound, while sugar futures for March delivery rose 0.3% to trade at USD0.2379 a pound.