Orange juice prices squeeze higher, as production falters

OJ prices squeeze higher, as production falters

5/31/24 11:11AM

Outta juice

There might soon be a vitamin C-shaped hole in many Americans’ breakfasts: orange juice prices are hitting all-time highs, as a series of poor harvests strain the existing supply of frozen juice futures.

Indeed, while the price of OJ has climbed at an alarming rate in recent years due to reduced production yields, this week saw frozen concentrated orange juice futures — which, with a two-year lifespan, usually help manufacturers to ease harvest shortcomings from season to season — reach a record price of $4.87 per pound. That’s roughly 5x where they were trading in 2020.

These juiced-up figures have arisen from a blend of bad weather and disease that’s long plagued the world's orange groves. Brazil has now seen 3 consecutive heatwave-hampered harvests, squeezing the output of the world’s largest producer, which accounts for ~70% of all exports. Just 3 weeks ago, research center Fundecitrus reported that Brazil was set to produce 232M boxes of oranges in the 2024-25 season, a 24% decline on the previous cycle.

And Florida, world-renowned for its oranges, won’t be able to pick up the slack. The Sunshine State has seen output decline steadily for more than 2 decades, thanks to citrus greening, hurricanes, falling yields, and a booming housing market that’s turned citrus farms into premium real estate.

With the orange segment looking increasingly bleak, farmers are exploring using alternative fruits — like mandarins, apples, and mangoes — to supplement diminishing supplies, as consumer demand for OJ remains as strong as ever.

Tasha Matsumoto

11h

Stocks trade higher as tech rebound continues

Tech was the best-performing sector for the second consecutive session.

Chicago Bulls Mascot Benny the Bull dunks the ball during the halftime show of the Missouri Valley Conference college basketball game between the Loyola-Chicago Ramblers and the Illinois State Redbirds on February 2, 2019.

Matt Phillips14h

Sandisk and Micron slip as Samsung rushes new product into production

Sandisk and Micron, which have boomed along with prices for the memory chips needed for the AI data center build-out, are limping behind the broader market Monday after a weekend report that South Korean chip giant Samsung is beginning “mass production” of its latest memory product, HBM4, slightly earlier than expected.

US memory chip maker Micron also makes HBM (high-bandwidth memory), which is essentially a large memory product designed for AI applications.

Sandisk doesn’t make HBM. But it is developing a kind of high-bandwidth flash NAND memory product that is intended to function as an HBM option for AI data centers.

More broadly, signs that Asian production giants are responding to high prices by ramping up supply means that the nosebleed pricing of memory chips that quintupled Sandisk’s profit over the last year might not last forever.

Samsung to begin mass production of HBM4 chips later this month: sources | Yonhap News Agency

Samsung moves first on HBM4 in bid to regain AI memory edge

US memory chip maker Micron also makes HBM (high-bandwidth memory), which is essentially a large memory product designed for AI applications.

Sandisk doesn’t make HBM. But it is developing a kind of high-bandwidth flash NAND memory product that is intended to function as an HBM option for AI data centers.

Hyunsoo Rim

GLUTIDE TURNED

16h

Novo Nordisk has lost most of its post-Wegovy market cap gains

A weak sales outlook and a copycat scare capped a brutal week for Europe’s one-time most valuable company.

Still life of a bottle of the new Wegovy semaglutide tablets on a womans hand.

Matt Phillips17h

Oracle rises as DA Davidson gives it a “buy” rating because of OpenAI positivity

Oracle rose after receiving an upgrade to start the week. Analysts at DA Davidson bumped up their view on the stock from “neutral” to “buy” and kept their $180 price target on the shares. That’s about 27% higher than Friday’s close.

Their shift isn’t so much about Oracle but about OpenAI, which Davidson folks now think is increasingly likely to be able to make good on billions of dollars’ worth of planned spending on computing power at Oracle and other hyperscalers. They wrote:

“We are now more positive on OpenAI, based on changes in strategy, new frontier models, the pressure on Google’s competitors from its recent ascent, and progress on its fundraising efforts. Most importantly, we believe OpenAI already has as much as $40B of cash on hand and may be raising as much as another $100B by the end of the quarter, which should help pay for the data centers Oracle is building for OpenAI. Since the market is currently assigning the OpenAI relationship a negative value, we believe the fundraise will serve as a catalyst for outperformance.”

For OpenAI’s part, CEO Sam Altman just told employees that the company was “back to exceeding 10% monthly growth,” according to CNBC reporting.

Max Knoblauch17h

Roblox rises following upgrade and price target hike from Roth Capital as growth in older players boosts optimism

Shares of Roblox are up in early trading on Monday following a price target hike and an upgrade from “neutral” to “buy” from Roth Capital.

Roth bumped its price target up from $78 to $84, with analyst Eric Handler citing the company’s “sustainable virtuous circle where continuously improving creator/development tools are producing higher quality games, which enhances the user experience, and drives higher engagement.”

Handler also noted Roblox’s success in growing its 18-plus player base, which increased 50% last year and, per Roth, “monetized 40% higher than under-18-users.”

The platform surged after reporting its fourth-quarter earnings last week, with stronger-than-expected full-year bookings guidance. Still, the stock remains below levels in January, before the debut of Google’s AI interactive worlds generator, Project Genie.