NEW YORK: Orange juice futures ended lower Monday on sales by small speculators as the market consolidated the hefty gains it posted this month, analysts said.
A string of possible weather threats to the major citrus growing state of Florida boosted the market, they said.
The benchmark January FCOJ contract fell 0.90 cent to finish at $1.6935 per lb, trading from $1.6625 to $1.721.
The spot November contract lost 2.35 cents to end at $1.839. On a spot continuation basis, the market ended the month up 22.6 percent.
Total volume traded Monday was over 1,400 lots, almost a fifth under the 30-day norm, preliminary Thomson Reuters data showed.
"It's pulling back a little. We had a good run so we're now backing and filling up a little bit," a dealer said.
Traders said investors built a storm premium in the juice market over the past month in case Florida, the top citrus growing state in the country, gets hit by a storm and sustains damage to its $9.1 billion citrus industry.
Analysts said the market also began winter premium buying in case Florida's citrus farms get hit by a hard freeze during the northern hemisphere winter.
A hard freeze damaged Florida's citrus groves during the last two winters, leading to price spikes in the FCOJ market.
Last-minute switch trade was seen as players unwound positions before the spot November contract goes into delivery as the close of business on Monday, dealers said.
Open interest stood at 26,872 lots as of Oct 28 versus the 26,917 lots as of Oct. 27, ICE Futures US data said.
Volume traded on Friday hit 1,344 lots against the prior session's 1,821 lots, exchange data showed.
Comments
Comments are closed.