Feb. 25 (Bloomberg) -- Orange-juice futures rose for the fourth straight session on concern that dry weather may curb yields in Florida, the world’s second-largest citrus grower. Cotton, sugar and coffee fell, while cocoa gained.
Precipitation in most of Florida’s citrus belt in the past month was 20 percent to 60 percent of normal levels, and the moisture deficit will continue to increase in the next 30 days, Commodity Weather Group LLC said on Feb. 22. Fund managers more than doubled their bets on rising orange-juice prices in the week ended Feb. 19, government data show.
“The dry weather and the extreme bullishness on the part of large speculators are pushing prices higher,” Michael Smith, the president of T&K Futures & Options in Port St. Lucie, Florida, said in a telephone interview.
Orange juice for May delivery rose 0.4 percent to settle at $1.2975 a pound at 1:39 p.m. on ICE Futures U.S. in New York. The price has jumped 11 percent this year.
In March, the U.S. Department of Agriculture may cut its estimate for Florida’s crop for the fourth straight month, lifting prices to $1.40, Smith said. Brazil is the top grower.
Cotton futures for May delivery dropped 1.7 percent to 81.72 cents a pound, the biggest decline for the most-active contract since Jan. 25.
Last week, stockpiles at warehouses monitored by ICE jumped 46 percent to 347,963 bales, the highest since July 2010.
“The inventories might be putting some psychological pressure” on the market, triggering sales, Peter Egli, a Chicago-based director of risk management at Plexus Cotton Ltd., said in a telephone interview.
Raw-sugar futures for May delivery declined 0.3 percent to 18.09 cents a pound.
Arabica-coffee futures for May delivery fell 0.5 percent to $1.431 a pound.
Cocoa futures for delivery in May rose 0.2 percent to $2,143 a metric ton.
--With assistance from Marvin G. Perez in New York. Editors: Patrick McKiernan, Thomas Galatola