Hurricane Ian was set to produce significant damage to much of Florida's citrus crop as it tore through the central-southwest part of the state, threatening to send the price of orange juice higher.
November orange juice futures contracts were trading as high as $1.92 per pound Wednesday before falling back to $1.87.
Orange crops had already suffered production declines this year, with further declines expected, thanks to a so-called greening disease.
The storm will only add to those woes, said Jack Scoville, vice president at PRICE Futures Group, a trading firm in Chicago.
"The amount of loss is going to be pretty significant," Scoville said. "The state has already been trying to come back from a greening disease problem from another hurricane a few years ago that blew the disease up from South America. ... I would say this hurricane will probably affect half the oranges down there one way or another."
Depending on the season, more than 90% of America’s orange juice is made from Florida-grown oranges, according to state data.
In July, the price of orange juice on grocery shelves hit an all-time high of $2.89 per 16 ounces thanks to food-price inflation that's been driven in part by higher energy and labor costs.
According to the Agriculture Department, cold storage stocks of orange juice were at lows not seen since at least 2019 heading into August. Scoville said U.S. producers will now be lucky to maintain those levels.
"It's going to be dramatic," he said.
