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Boom times ahead for weary citrus industry

Hurricanes. Canker. Low-carb diets. Growers who have had it rough are gleeful as demand and supply picks up again.

By KRIS HUNDLEY
Published October 13, 2005

	[Times photo: Skip O'Rourke]
	Citrus grower G. Ellis Hunt Jr. examines a Valencia orange Wednesday in one of his groves. The third-generation grower said, "It's important to get profitability back to the grove owners and at this level, we might return to profitability."

LAKE WALES - After losing fruit last year to hurricanes and trees this year to canker, G. Ellis Hunt Jr. was about as upbeat Wednesday as a Florida citrus grower gets.

Upon hearing official USDA estimates that Florida's orange crop would be up 27 percent for the 2005-2006 season, rebounding to 190-million boxes after last year's storm-decimated crop, Hunt pronounced it "a decent amount of fruit."

"We need 200-million boxes to supply the needs of the U.S.," said Hunt, 52 and a third-generation grower, while giving a tour of his groves in the heart of citrus country. "It's important to get profitability back to the grove owners and at this level, we might return to profitability."

If Florida's $9-billion citrus industry is celebrating the bounce back in the state's production after last year's storms, consumers may not want to join the party just yet.

The retail price of orange juice will rise about 10 cents a gallon this year after remaining fairly flat for several years, said Bob Norberg, director of economic and market research for the Florida Department of Citrus in Lakeland. That estimate does not include increased labor and energy costs. Norberg said the current retail price of a gallon of orange juice averages about $4.50.

The reasons for a price hike? Demand for orange juice is starting to pick up as consumers start to shed low-carb diets. The state Citrus Department also has stepped up its aggressive advertising of orange juice's health benefits, working closely with Wal-Mart, which accounted for nearly 20 percent of the nation's orange juice sales last year.

On the supply side, juice inventory remains relatively low due to the size of last year's orange crop, which was the smallest since 1992-93.

About 95 percent of Florida's orange crop is processed into orange juice, while only 5 percent is packed for sale. Florida produces about 1.2-billion gallons of orange juice per year.

The state has about 750,000 acres of citrus, an area slightly larger than the state of Massachusetts.

Wednesday's citrus crop forecast was widely watched as the industry counted up losses from both hurricanes and canker disease. Dan Gunter, executive director of the state Citrus Department, said the estimate was within expectations but welcome nonetheless.

"Growers are likely to see better returns, which is good news as they continue the recovery," Gunter said. His agency, supported by an 18.5-cent tax on each box of oranges, does marketing and research for the industry.

While orange production is projected to rise 27 percent, the grapefruit crop is up even more, expected to nearly double from last year's record low of 12.8-million boxes.

This year, Florida's growers say they should pack 24-million boxes of grapefruit. The fruit is popular internationally, especially in Japan, even though U.S. demand is flat.

Gunter said the grapefruit crop had been particularly susceptible to both hurricane winds and canker last season.

Citrus groves find they are also increasingly susceptible to land developers.

Gunter cited grapefruit growers in the Indian River area who lost trees to hurricanes last year. "There will be an economic incentive to replant, though I expect the production will be in other areas of the state where land is cheaper," Gunter said. "Citrus can't compete with development."

Other types of specialty citrus in Florida, including temple oranges, tangelos and tangerines, are expected to total 8.3-million boxes this year, up 25 percent over a year ago. The total citrus yield in Florida this year will be 222.3-million boxes, up 31 percent from a year ago. A box typically contains 90 pounds of oranges or 85 pounds of grapefruit.

Officials and growers said they were pleased to find tree loss to both hurricanes and canker was less than initially expected. According to a census released Wednesday, tree count is 5 percent lower than last year. Remaining trees have fairly heavy harvest, but the fruit, of all varieties, is smaller than normal.

Hunt, whose family has 5,000 acres of citrus in Lake Wales and South Florida, said storm-stressed trees seem to be producing nearly as many leaves as fruit this year.

"The trees were violently shaken by the storms," he said. "But the freeze in 1989 was worse because it actually killed the trees."

Hunt is also hopeful that damage to his Lake Wales grove from a recent canker outbreak has been limited to about a 250-acre patch. The trees have been destroyed and the ground will lie fallow for several years.

"If you're a Florida farmer, you kind of roll with the punches," said Hunt, who expects his business to produce about 1.7-million boxes of citrus this year, compared with 1.5-million last year. "You implement all the canker protocol and all the decontaminating procedures. That's another reason why it's nice to be diversified (with groves around the state)."

Gunter sounded almost optimistic about the canker threat on Wednesday, saying reports of new findings are declining since hitting a peak in May and June.

But in August another threat to the state's citrus industry was discovered in a back yard in South Florida. A state inspector found a case of citrus greening disease, also known as yellow dragon. The disease, which is spread by insect, dries out and destroys the tree.

"It has not been found in commercial production areas," Gunter said. "But it is a huge concern to Florida. We're watching out for the disease and implementing strict protocol. We're hopeful they can contain it."

Asked about the threat of greening, citrus grower Hunt minced no words.

"Yeah, it's very serious," he said. "We're hopeful that with the canker inspections we have in place, we'll contain it. Because if it got to spread like canker, we might be done."

Kris Hundley can be reached at hundley@sptimes.com or 727 892-2996.

[Last modified October 13, 2005, 01:12:06]