Saturday, February 11, 2012

Today's Major Market Move: FCOJ Futures Down 11.5% in February

Since today's topic is frozen concentrated orange juice futures, we have to provide the obligatory Trading Places reference. "You idiot! Get back in there at once and sell...sell!" Prices have dropped 11.5% in the current month and are now below where they were when the great "Brazilian Fungicide OJ Boom of 2012" started back on January 10th.

Click here to go to the live chart.
Commodities priced in US dollars in general have done well in 2012, with 22 out of 29 of the commodity futures we track in the black. This is largely due to the declining value of the dollar, which this year has weakened against over two thirds of the world's currencies.  Even with this month's decline, FCOJ is still the 6th best performing commodity going back to the beginning of the year, with a 9.9% gain. Here's the top 10:

Click here to go to the live table.
According to this article from Reuters there are potentially two positive outcomes to the current Brazilian ban that will avoid a prolonged contraction in supply:
1) Brazil will come to an agreement with the FDA to allow it to resume importing or 2) if the ban persists, California growers will be able to make up for the difference.

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