Naked Juice, owner of Tropicana, warns of financial impact due to rising orange prices.
- Citrus greening disease devastates Florida’s orange crops, doubling prices to $6,500 per tonne.
- Naked Juice’s profit forecast drops from $375m to $322m amid increased production costs.
- The company shifts sourcing to 75% Brazilian oranges to mitigate disease impact.
- Industry leaders stress the need for pricing strategies to address supply challenges.
Naked Juice, the proprietor of Tropicana, has alerted stakeholders to the significant financial implications posed by the escalating prices of oranges, primarily attributed to citrus greening disease. This disease, altering the colour and taste of fruit, has been particularly devastating in Florida, a major source of oranges for Tropicana.
As reported by The Times, the disease has prompted a dramatic surge in orange prices, now exceeding $6,500 per tonne—more than double previous levels. This increase is directly impacting Naked Juice’s production costs. Consequently, the company’s anticipated profits are forecasted at $322 million this year, a notable decrease from the previously projected $375 million.
The geographic impact of citrus greening has necessitated a strategic pivot in sourcing. Naked Juice has predominantly relied on Floridian oranges; however, the spread of the disease in the region has forced a shift to Brazilian oranges, which now account for 75% of their supply. This transition is facilitated by Brazil’s more effective disease management technologies, enabling more consistent quality and supply.
The repercussions of disease and other adverse factors, such as droughts and extreme weather conditions in these regions, are prominent in the market. Industry voices, including Innocent’s executive Nick Canney, are vocal about inevitable price increases. Canney emphasised the importance of pricing strategies to keep products affordable while covering rising costs, stating, “Over time, it will definitely move prices forward again. You have to try and work out how to keep it affordable for people.”
The soaring orange prices and strategic sourcing decisions underscore the ongoing challenges within the juice industry.
