Orange juice buyers squeezed by storms
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“Few markets are as volatile to trade as orange juice,” says Kevin Kerr on Dailyreckoning.com. “A hurricane… or a hard freeze in central Florida can send this market reeling.”
And for the next few months, orange juice could be extremely volatile. Two years of severe hurricane and diseases have battered producers and left buyers jumpy; prices recently spiked to a 16-year high of $1.88/lb on fears that Tropical Storm Ernesto would cause fresh damage, says Millie Munshi on Bloomberg.com.
Ernesto turned out to be a false alarm, but with this winter likely to be harsh, prices may soar higher, says Kerr.
For those looking to bet on this via futures or options, he favours the January 2007 contract since it’s liquid and has plenty of time to expiry.
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