Weekly commodity wrap-up

Orange Juice Catches on Fire

Frozen concentrated OJ has become the hottest game in town among investors and speculators, at least among the commodities staples Americans depend on. The meteoric rise of the liquid gold accompanied the smallest crop in almost 90 years because of a combination of frost damage, hurricanes, and the continued plague of the citrus greening disease. That disease, spread by a psyllid in the air, has been expanding since 2004. The psyllids suck the sap from the orange trees, depriving them of water and nutrients. The two major hurricanes, Ian and Nicole, knocked the harvest to the ground and left many growers fruitless for two seasons. Friday’s high of $2.45 per pound was an all-time record.

Cattle Stampede Upward

In second place for rising commodities this week was live cattle. The smallest supply in nine years resulted from drought conditions in much of the southwest where feed supplies have diminished, along with water. Forecasters expect the drought to continue. If so, it may fuel persisting speculation of shortages in the months and years ahead. Cattle prices have nearly doubled since March 2020. April cattle hit a high Friday of $1.6422 per pound.

Precious Metals, Petroleum Plunge to New Lows

Gold, silver and platinum tumbled when strong employment numbers hit the headlines Friday morning. Crude oil, diesel, and unleaded gasoline fell to their lowest levels in several weeks too. Investors fear the Fed will raise interest rates more aggressively to counteract a surprisingly hot and tight employment atmosphere which could increase inflation. Stock index futures fell as well. Silver and platinum broke lows made six weeks ago.

Crude and the metals seemed to ignore the saber rattling associated with reports of the Chinese spy balloon spotted over Montana that caused Secretary of State Blinken to cancel his plans for a diplomatic visit to Beijing.

Weekly Leaders and Losers

The big ups this week were O.J., the U.S. dollar index, and cattle. The huge downers included crude and its products, all foreign currencies, all metals and soybean oil. The grains continued to chop sideways with remaining within last week’s range. By Friday afternoon, March OJ went for $2.40 per pound, April cattle $1.6412 per pound, April gold for $1878 per ounce. March corn closed at $6.77 per bushel, Mar. wheat at $7.57, and March beans at $15.32.

Opinions are solely the writer’s. Walt Breitinger is a commodity futures broker in Valparaiso, Ind. He can be reached at (800) 411-3888 or www.indianafutures.com. This is not a solicitation of any order to buy or sell any market.