NY juice lower on profit-taking, ends win streak

NEW YORK: Orange juice futures ended nearly 2 percent lower on Wednesday, snapping a four-day win streak, as a recent rally above $2/lb and narrowing spreads trading prompted investors to take profits.

The key September frozen concentrated orange juice futures ended down 3.75 cents or 1.9 percent at $1.979 per lb, dealing from $1.9705 to $2.0180.

Volume was around 2,100 lots by 3:30 p.m. EDT (1930 GMT), about 10 percent above the 30-day norm, Thomson Reuters preliminary data showed.

"Investors took profits after the contract stayed above $2/lb for a period of time, and the spreads are narrowing up," said Kevin Sharpe, broker of Basic Commodities.

During the OJ market's four-day rally, prices were supported by tight US cold storage and lingering supply worries from Brazil.

A wild 200-point ride of the Dow dragged by economic fears also prompted investors to sell commodities and riskier assets.

Traders said that the OJ market largely ignored possible weather disruptions by Tropical Storm Emily, which may become a low-level hurricane.

If Emily survives its trek across the high terrain of Hispaniola, the Miami-based NHC said weather conditions appeared to support intensification later this week.

Florida is the world's largest citrus growing region.

The peak period for a storm or hurricane to strike Florida, the biggest citrus producer in the country, runs from late July through the middle of October.

The trade is also waiting for the first private estimates of the upcoming 2011/12 Florida citrus crop, which will be released around the middle of August.

Open interest in juice futures stood at 36,810 lots as of Tuesday, up slightly from Monday's 36,681 lots.

Traders believe resistance for the September FCOJ contract would be at $2.05, with support at $1.90 and $1.85.

Copyright Reuters, 2011