COMMODITIES-Orange juice jumps as Florida faces freeze
By Alden Bentley
NEW YORK, Feb 4 (Reuters) - Orange juice futures jumped almost 4 percent on Wednesday as an arctic air blast enveloped Florida and threatened to damage supply from the largest citrus-growing state.
Early optimism that the worst of the global economic downturn may be behind helped support copper and other commodity prices, before the U.S. stock market turned lower late in the day and undermined crude oil prices.
At ICE Futures US, the March frozen concentrated orange juice contract OJH9 hit its highest level since Jan 22, ending up 2.85 cents, or 3.92 percent, at 75.40 cents per lb.
The National Weather Service predicted that temperatures could drop below freezing on Wednesday night in several citrus-producing counties and in some places stay there for longer than 12 hours.
Citrus crops will suffer damage if temperatures fall to 28 degrees or below for four hours or more.
In years past, juice futures often rose the 10-cent limit in the spot month on the threat of a freeze. But bumper supplies, flat retail demand and stiff competition from rival juice drinks has curtailed the buying.
Copper rose to a one-week high on reports of increased Chinese buying and upbeat economic data from China and the United States.
Copper for March delivery HGH9 rose 0.90 cent to settle at $1.5310 a lb on the New York Mercantile Exchange's COMEX division.
"There has been some reasonably positive macro data and more speculation on SRB (China's State Reserves Bureau) buying...it doesn't take much to move the markets to the upside," Gayle Berry, an analyst at Barclays Capital, said.
China has started buying copper from domestic warehouses and overseas markets as a move to gradually triple its state reserves to about 1 million tonnes, trade sources familiar with the situation said. [ID:nSHA29168]
A rise in China's official manufacturing index and a surge in bank lending led to optimism the world's third-largest economy may soon be on the road to recovery.
A less severe contraction in U.S. private sector jobs and in the services sector added to the red metal's positive tone.
The Institute for Supply Management said its non-manufacturing index came in at 42.9 in January compared with 40.1 in December. [ID:nN04508901]
On the New York Mercantile Exchange, March crude CLH9 settled down 46 cents, or 0.46 percent, at $40.32 a barrel, traders said
Crude futures were up earlier on OPEC hints of more production cuts and Wall Street's earlier rise on strong service sector data and January's slowdown in job cuts.
Department of Energy statistics showing a big increase in crude supplies last week weighed on the market.
"The pull back seems to coincide with the stock market turning lower, but crude is still holding around $40, which in light of the bearish DOE report is pretty impressive," said Stephen Schork, editor of the Schork Report in Philadelphia.
Worries about the inflation repercussions of U.S. President Barack Obama's $825 billion stimulus package, and liquidity provisions by global central banks helped lift gold for April delivery GCJ9 $9.70, or 1.1 percent, to $902.20 an ounce on the COMEX.
UBS metals strategists predicted that gold investment demand will double in 2009 from 2007, and that gold prices will average $1,000 an ounce this year. [ID:nL4646344] (Reporting by Alden Bentley; Editing by David Gregorio)
- Tweet this
- Share this
- Digg this