Top 3 Best Orange Juice Stocks to Watch
When it comes to commodities, orange juice is hardly near the top of investors’ lists.
Considered a thinly traded asset, orange juice has, against the general odds, been drawing plenty of attention since the start of 2023, with an increasing number of investors leaning towards orange juice stocks.
Due to the combination of different factors, which include extreme weather events and poor crop health, orange juice prices have soared. Suddenly, what was considered a rather basic commodity option has gained prominence.
In this article, we will go through the basics of the best orange juice stocks, their advantages and disadvantages, and how to buy them, amongst other related topics.
Sounds interesting? Let’s get started.
Table of Contents
Best Orange Juice Stocks: Introduction
The commodities market has seen an upward trend over the last two years.
Between the geopolitical turbulence and a rise in extreme weather events, prices for agricultural commodities in particular - such as wheat, cocoa, coffee and, of course, oranges - have soared in a relatively short period.
Orange juice prices nearly doubled over the course of 2023, going up by 90%. While commodities prices are traditionally volatile, orange juice stood out over the past 12 months. Rather than going back down, orange juice prices have continued to trend up.
Now it’s only fair to wonder - why have orange juice prices gone up so significantly? The answer is related to two different factors - weather and diseases.
The orange juice market is largely dominated by Brazil, which is responsible for 75% of the global production.
However, dry weather, combined with a crop disease called citrus greening, has led to a significant drop in production. Consequently, orange and orange juice prices have gone up as a result.
Dry weather has also been a problem in Mexico, the third-largest orange producer. As for the US market, Florida is responsible for 80% of the orange production in the country.
The Sunshine State, however, has been hit by extreme weather events, with two hurricanes seriously damaging the orange production.
Additionally, poor crop health because of a bacterial disease only made things worse - again leading to a rise in price.
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What are Orange Juice Stocks?
Orange juice stocks refer to publicly traded companies that produce orange juice, simply put.
In the case of orange juice, the popular brands are usually subsidiaries of major companies, such as Coca-Cola, Pepsi, Walmart, and Kroger, to name a few.
Orange juice commodities CFDs can also be considered an option. Please always consider risk management before investing in any financial products and understand the pros and cons involved with derivative products.
What’s the current outlook for orange juice stocks?
For now, signs point that prices will take a while to go down.
As mentioned earlier, Brazil is responsible for three-quarters of the global orange juice market.
However, with the citrus greening disease still around, producers are holding back on expanding their orchards.
Orange supply will continue to suffer as a result, which means that the price won’t be going down in the short term.
While investing in orange juice stocks and commodities may look inviting at first glance, keep in mind that all commodities are cyclical and volatile.
In other words, that price will likely decline at some point in the future. Take that risk into consideration before trading or investing, as part of your risk profile.
Best Orange Juice Stocks: Advantages and Disadvantages
Just like any other investment, orange juice stocks come with their pros and cons.
We will now go through some of the advantages and disadvantages to consider before potentially trading or investing.
Best Orange Juice Stocks: Advantages
- Orange juice has been among the best-performing commodities over the past 12 months. That trend hasn’t shown any signs of slowing down shortly.
- With extreme weather events and poor crop health still being a major problem, the supply chain will continue to take hits over the next few months. As a result, orange juice prices will remain high.
- Adding orange juice stocks can further diversify your portfolio, adding exposure to the commodities market as well.
Best Orange Juice Stocks: Disadvantages
- Like any other commodity, orange juice is a cyclical asset. It may take a while longer, but production is eventually going to pick up again, which, in turn, will drive prices down. Likewise, a drop in demand, driven by the current high prices, could also lead to negative results for an investment.
- Compared to other commodities, orange juice is still considered a thinly-traded asset. As a result, any shift in the market can lead to bigger swings.
- The two factors listed above mean that orange juice is a highly volatile asset. While prices have sky-rocketed recently, it could lead to a dramatic drop in a short space of time.
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Top 3 Best Orange Juice Stocks to Watch
As mentioned earlier, orange juice brands are, for the most part, subsidiaries of larger companies.
Due to this, you won’t be investing directly in orange juice companies. However, you can still benefit from the orange juice market by investing in those stocks.
1. The Coca-Cola Co. (KO)
The beverage industry juggernaut also has juice brands among its subsidiaries, including Minute Maid and Simply Beverages.
Advantage of Coca-Cola stocks:
- Coca-Cola is among the biggest companies in the world, and it’s also a market leader - not only in the soft-beverage segment. Coca-Cola has a sizable slice of the orange juice market with some of its brands, making it a solid investment overall.
Disadvantage of Coca-Cola stocks:
- Just like similar stocks, Coca-Cola shares are available at a premium price. This can potentially drive away some investors due to high barrier entry costs.
You can trade the KO CFD in both price directions, or invest directly in KO at Admiral Markets.
2. PepsiCo Inc. (PEP)
Much like its soft-drink rival, Pepsi also has a few subsidiaries in the orange juice market. The one that stands out is Tropicana, which has the largest market share in the US. Pepsi sold 61% of Tropicana to PAI Partners but still owns the remaining 39%. Naked, another popular juice brand, was also included in the sale.
Advantage of Pepsi stocks:
- Despite having sold out the majority of its juice business, Pepsi is still present in the market with some of the leading brands in the segment.
Disadvantage of Pepsi stocks:
- Pepsi’s namesake and flagship product has seen a decline in sales, as customers continue to seek healthier alternatives. This could lead to a shuffle down the line, which could hurt subsidiary brands.
You can trade the PEP CFD in both price directions, or invest directly in PEP at Admiral Markets.
You can view the Daily fluctuations of the PEP stocks via TradingView:
*Past performance is not representative of future results.
3. Nestle SA (NESN)
The Swiss food industry juggernaut also has several juice brands under its umbrella, making it an interesting option if you are looking for orange juice stocks.
Advantage of Nestle stocks:
- Nestle is a well-established brand. It can be considered a somewhat stable investment for those who are looking for slow but steady returns.
Disadvantage of Nestle stocks:
- On the other end of the spectrum, Nestle doesn’t offer too much for growth investors. If you are looking for big returns, then the Swiss food and beverage giant probably won’t sound like a very attractive option.
You can trade the NESN CFD in both price directions, or invest directly in NESN at Admiral Markets.
How to Buy Orange Juice Stocks
If you are looking for ways to invest in orange juice stocks, then the best way to do so is with a reliable and regulated broker, like Admiral Markets.
You can start with a demo account, which lets you trade risk-free, without using real assets. This way, you can have a better understanding before moving on to live trading.
Investing in orange juice stocks is fairly simple with MetaTrader 5. One of the most popular trading and investing tools in the market, MT5 is a user-friendly platform that offers a number of interesting features:
Advanced and personalized charting options.
- Market data and news.
- Educational tools.
- Access to thousands of markets.
- Automated trading tools with AI bots.
Sign up for an Admiral Markets account and start investing in orange juice stocks to expand your portfolio.
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Best Orange Juice Stocks to Watch: Conclusion
Orange juice stocks have been drawing attention since early 2023, and that trend is set to seemingly continue as we move through the first quarter of 2024.
The key factors behind this sudden and unexpected rise - extreme weather events and poor crop health caused by diseases - won’t be dealt with right away, so it may take time for prices to lower. Aside from that, adding orange juice stocks will diversify your portfolio and offer exposure to the commodities market.
On the other hand, keep in mind that, like all other commodities, orange juice stocks are cyclical. Even if their rise has been going on for longer than anticipated, the price is bound to come crashing down at some point.
This is a highly volatile investment, so keep that in mind before committing to a decision.
If you would like to register for a live account in order to start trading and investing, you can register for free with Admiral Markets by clicking the banner below:
Can you invest in orange juice?
Yes, it is possible to invest in orange juice. One can invest in orange juice via commodities, or companies which produce and sell orange juice, such as:
- Coca-Cola
- Pepsi Co.
- Nestle
How is orange juice traded on the stock market?
Orange juice is traded on the stock market via banks and online brokers, via CFDs (Contracts for Difference) or direct commodity trading or investing.
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