Oranges perform better than oil and the rest of the goods are cause corona
Economy News _ Baghdad
In the time of Corona, people, including investors, are seeking to strengthen their capabilities in the face of the invisible killer. At a time when all types of commodities are witnessing a sharp selling wave by investors, orange contracts have been the best performing commodity contracts on the New York Stock Exchange since the beginning of this year.
Bloomberg data indicates that frozen orange juice contracts were the best-performing commodities ever since the beginning of the year with a rise of about 25% around $ 1.20 pounds per time as consumers rush to increase inventory amid fears of supply chain disturbances that may result in a shortage in supply to the final consumer According to the British newspaper "Financial Times".
Trading in oranges started as a commodity in the 1950s with the possibility of trading it today through options and futures contracts, and is one of the means that farmers in the United States resort to to hedge against any possible fluctuation in the prices of their crops.
Neil Murray, commodity analyst at IHS Markit, told the newspaper that the high price of orange contracts is due to a high demand for it at a time when there are abundant oranges, but like "toilet paper" there is no shortage, but the demand for it is great.
Another analyst told the newspaper, “The price hikes are related to supply chain concerns ... There are questions about workers’ ability to go to factories in Florida and Brazil, as well as not having enough containers to ship the product to consumers.
Investors' appetite for oranges comes in conjunction with an increase in supply by major producers in Brazil and the US state of Florida, after years of declining demand with consumers heading towards consuming water and other drinks that contain lower levels of sugar.
Orange sales rose by about 10% in four weeks on an annual basis until March 14, according to data "Nielsen", which depends on citrus crop management figures in Florida, while sales of orange juice increased by 27%.
Prior to the large-scale Corona outbreak in the United States, figures released in February indicated a drop in orange sales by 2% and a drop in orange juice sales by 1.3%, indicating an increase in consumer turnout due to epidemic concerns.
"People are realizing the importance of oranges as a source of vitamin C to strengthening their immune system ... I think this explains the reason why orange is so popular," said Andrew Meadows, communication officer for one of the associations representing citrus producers in Florida.
According to the director of research at the Florida Crops Department, demand exceeds supply, which may give an explanation for the reasons for the high prices of orange futures contracts.
Marisa Zansler says, "The current forecast indicates a price increase in the near term for several reasons, including the desire of consumers to move towards healthy drinks."