More WSJ hurricane / orange juice, etc. commentary :
Hurricane Ivan Pushes Up Coffee And Orange Juice
By NICOLE WYCKOFF
DOW JONES NEWSWIRES
September 10, 2004
CEDAR FALLS, Iowa -- Concerns over Hurricane Ivan's trajectory lifted frozen concentrated orange-juice futures and gave mild support to coffee futures.
Orange juice's front-month September contract rose 3.7 cents to 82.85 cents a pound at the New York Board of Trade, while the most active November contract gained four cents to 83.4 cents.
Hurricane Ivan's winds neared 160 miles per hour yesterday, making it a Category Five, the largest rating, said Global Weather Services.
A midmorning advisory from the U.S. National Hurricane Center showed Ivan landing near Florida's Fort Myers and Punta Gorda area sometime Monday evening, the same area devastated by Hurricane Charley in mid-August.
"It's got pretty much a bulls-eye on Florida the way it is right now," said Jon Taylor, senior meteorologist with GWS. Areas along some parts of the Gulf Coast, as well as the southeastern Atlantic Coast, are still at risk from Ivan, GWS said.
Hurricane Charley hit Florida on Aug. 13 and damaged an estimated 20 million to 25 million 90-pound boxes of oranges for the developing 2004-05 crop. Hurricane Frances hit there last weekend, with preliminary estimates putting the damage about 10 million boxes. Florida's orange-crop estimate could fall below 200 million boxes because of hurricane-related losses.
Arabica coffee futures found some support from Ivan, too, analysts said. The September coffee contract advanced 2.65 cents to 70.2 cents a pound.
"This one being a Category Five, and the cone in the projected landfall is so large, that [had] everyone buying a little bit of insurance today," said James Cordier, president of Liberty Trading.
There is also some concern about the heavy rain that could be associated with the storm, said Judith Ganes-Chase, president of J Ganes Consulting. Warehouses in Miami and New Orleans could get flooding damage. "As slim as [hurricane damage] may be, there's always that once or twice in lifetime chance," she said.
The sugar market also watched Ivan as the storm is forecast to move through Cuba. "The problem with Cuba is that the country's total production is now only two million tons," said Ms. Ganes-Chase. The Florida and Louisiana sugarcane areas are "such a small part of total world cane production" that it isn't much of an issue, she added.
Ivan could impact Southeast U.S. cotton, but cotton futures fell ahead of today's Agriculture Department production report, which is expected to show a large crop. "But once the market trades on that number, then I think we'll see Ivan come into play," said Boyd Cruel, senior softs analyst at Alaron Trading.
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