NEW YORK: Orange juice futures fell for a second straight session on Wednesday as the market continued to consolidate recent gains on supply worries driven by speculation about a banned fungicide in juice imports.
Benchmark May frozen concentrated orange juice fell 1.65 cent to close at $1.7880 per lb, trading from $1.7835 to $1.8350.
The nearby March contract ended down 4.05 cents at $1.8230 a lb.
Weakness in other agricultural commodities such as coffee and cotton and a dollar rise also weighed on the citrus market.
Analysts said that OJ futures could fall further. With retail demand stagnant, there seemed little anxiety in the market over the Brazilian imports.
The market has lost around a fifth of its value since the March contract hit an all-time high of $2.2695 on Jan. 23 due to speculation of a US ban on Brazilian juice imports.
On Friday, the citrus market rallied on supply concerns a day after the US Food and Drug Administration had turned down a request to change its acceptable levels of carbendazim, a fungicide commonly used in the Brazilian orange juice industry.
The FDA's decision will likely force Brazil, the world's top OJ producer, to stop exporting concentrated orange juice to the United States.
Industry sources said Brazil could resume frozen juice concentrates shipments to the United States by the end of 2012.
Investors have been reducing their exposure in the juice market. Open interest, an indicator of investor presence, has dropped by more than 10 percent to 22,844 lots as of Tuesday versus its peak in mid-January, ICE Futures US data showed.
Volume on Wednesday was substantial for a third straight session. It stood at 6,353 lots late in New York business, more than double its 30-day average, Thomson Reuters preliminary data showed.
On Tuesday, the exchange said 5,897 lots changed hands, its highest level since October 2011.
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