An update from Brazil's Centre for Advanced Studies in Applied Economics (CEPEA) has shown the 2013-14 citrus crop is still uncertain, with the sector focused on wrapping up the 2012-13 crop.

"Producers expect new PEP (Premium for Marketing of Products) and, mainly, Pepro (Equalization Premium Paid to the Producer) auctions to take place in the first months of 2013," CEPEA said.

"Moreover, they also expect the industry to purchase the remaining fruits to be harvested.

"For the 2013/14 crop (early varieties will be ready for harvesting from the second quarter of the year onwards), there are no perspectives of prices or schedule to start crushing."

The group said Cade (Administrative Council for Economic Defense) may not approve the current proposal to close contracts  based on Consecitrus (Council of Orange Producers and Orange Juice Industries), as producers do not yet have an "ideal representation".

"Therefore, it is still uncertain if Consecitrus will be implemented in the 2013/14 season.

"In this scenario, independent producers (without long-term contracts) should await purchase proposals from the industry. There are rumors that some processors are already interested in closing contracts for 2013/14, but without defined prices.

"However, producers surveyed by Cepea expect quotes to be more profitable compared to the 2012/13 crop, characterized by historically low prices."

CEPEA said there were no official forecasts for production in the state of São Paulo, the main driver of the industry, but players surveyed indicated they would be decreasing their orange groves.

"In general, weather conditions were not favorable during the blossoming of the orange trees.

"Another factor that may affect yield in the 2013/14 crop is the decreased cropping practices, because of low remuneration in the last crops. The high occurrence of greening has also influenced the output decrease in the São Paulo groves."

Brazil is the world's largest orange juice producer.

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