GenZ News for Kids: A Free-Thinking Education Starts Here ...

Close

Coronavirus Pandemic Makes Orange Juice Great Again

Never mind that fear of sugar – people want their vitamin C!

If you notice a yellow highlight on the page, hover over it for the definition!

Orange juice is back on the table in American households. In recent years, the classic breakfast staple had been shunned due to health concerns over its sugar content. Consumer demand slumped, decimating growers who were already reeling from citrus greening (a plant disease that affects orange trees). The Coronavirus pandemic is making orange juice great again.

In the first quarter of 2020, orange juice surprised financial markets and was an outperformer next to wheat. During the January-to-March period, futures for May delivery surged 25% to $1.20 per pound – it has since pared those gains by 5%. The futures market plays an important role in the economy since it indicates what people anticipate the future price of a commodity will be.

What happened? Two things: Coronavirus and Brazil. Since vitamin C can boost your immune system, consumers believe that drinking enough orange juice will shield them from the Coronavirus. The science has not supported this idea, but many Americans ramp up their OJ consumption whenever there is a significant health scare. This happened during the winter of 2018 when there was an uptick in influenza cases, and OJ sales had their best three-month period in several years. Plus, since more people are home from work, they are less likely to skip breakfast and more likely to drink a glass of orange juice in the morning.

Brazil, meanwhile, is warning about a less-than-expected harvest in the 2020-2021 marketing season. Farmers say poor weather conditions are impacting crops, and potential disruptions might affect production levels. This might threaten the global supply chain, which also lifted prices.

In the end, it shows how the commodity market is cyclical. When there is high demand and low supply, prices go up. That’s a basic economic law.

Andrew Moran

Economics Correspondent at LibertyNation.com and LNGenZ.com. Andrew has written extensively on economics, business, and political subjects for the last decade. He also writes about economics at Economic Collapse News and commodities at EarnForex.com. He is the author of “The War on Cash.” You can learn more at AndrewMoran.net.

Related Posts