Weather, disease decimate Florida citrus groves

NEW YORK Fri Oct 9, 2009 11:11am EDT

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NEW YORK (Reuters) - Drought, freezing weather and a fatal disease have savaged Florida's $9 billion citrus industry, causing output to drop to its lowest level in three years, the government and industry analysts said Friday.

The U.S. Agriculture Department forecast Florida's 2009/10 citrus crop to fall 16 percent from last season to 136 million (90-lb) boxes, the second lowest over the last decade. Only the 2006/07 crop at 128.9 million boxes came in lower.

Orange juice futures in New York rallied 10 percent on the smaller-than-expected forecast. Analysts had expected USDA to announce a crop size ranging from 141 to 160 million boxes.

Some bet on a high number because of reports that fruit sizes in Florida were good and weather conditions ideal given the absence of any storms during the 2009 hurricane season to hit Florida, the top citrus grower in the United States.

USDA said the primary culprit for the lower forecast is the weather in the spring, which took a toll on Florida's citrus trees.

"Weather conditions in Florida's citrus growing regions during early 2009 were characterized by a series of cold fronts, freezing temperatures and below average rainfall," USDA said in a report.

"The drought conditions continued into May, resulting in a 19 percent decrease in average fruit per tree from last season," it added.

But several analysts pin the blame on citrus greening, or yellow dragon disease, because it is believed to have started in China in the early 1900s.

There is no cure for the citrus greening bacteria, which attacks the vascular system of citrus trees and eventually kills them in a few years.

"I think disease had more to do with (the low USDA number)," said Sterling Smith, an analyst for Country Hedging Inc in Minnesota. "There's no other cure than tree eradication."

A long-time analyst who follows the juice industry added: "The number of fruit per tree is quite low and the cause for that is probably disease-related."

The insect carrying the citrus greening bacteria was found in Florida just before 2000 and the four hurricanes that struck the Sunshine State in 2004 and 2005 spread the disease.

Florida state agriculture and industry groups have mounted an expensive effort to eliminate the insects who spread the disease.

Florida has lost more than a fifth of its orange trees and its citrus acreage in the last five years due to disease, hurricanes and urbanization.

(Editing by Lisa Shumaker)

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