Lime Squeeze

May 14, 2014

Poor Weather, Citrus Tree Disease Blamed for Lime Crop Shortage

Where’s the lime in my drink?

That’s a question that you might be asking when you’re at the bar this summer. Interestingly, as we head into prime patio season, there is a lime shortage in North America - and it’s putting the squeeze on restaurants and bars.

Prices for the green citrus fruit have been jacked up. Cases of limes are being sold for as much as $200, while only a few months ago they were selling for about $30 to $40.

Bad weather destroyed much of the lime crop in Florida, and now the next closest growing area for limes, Mexico, is experiencing similar problems. Unfavorable growing conditions in Mexico and a citrus tree disease (called huanglongling) are all factors contributing to the scarcity. And to make matters worse, a Mexican drug cartel has reportedly taken advantage of the situation, driving prices up even further.

Some restaurants and bars in Canada and the U.S. have begun switching up their drink recipes, wherever possible, and in some cases offering lemons as a substitute.

Video: U.S.-China Trade “Truce” + U.S. Fed Cuts Rates Again

The market was hoping for a US-China trade deal, but we got a trade “truce” for now from the keenly awaited Trump-Xi meeting at the APEC Summit.
China commits to minimum purchase commitments of 12 MMT of U.S. soybeans during the “current season” and a minimum of 25 MMT annually through 2028.
U.S. Treasury Sec Bessent said other Asian countries have agreed to buy additional 19 MMT of US soybean.
Soybean futures trading above $11 now- they normally tend to rally to $12.
As expected, US Fed cuts interest rates by -0.25% again in October to 3.75%–4.00%. No further cuts promised for this year but trade looking out to the Dec FOMC.
The Bank of Canada cut interest rates to 2.25% but raised concern over trade war damage.
Soy meal futures, remarkably, have had 14 consecutive higher close sessions. A bull market in soybeans is a bull market in soy meal!
Cattle futures lower as funds unwind out of cattle for now due to Trump headlines and objective to lower beef prices.
All major stock indices climb to new record highs. It was Mag 7 reporting week, which had mixed results. But we now have the first $5 trillion company in Nvidia!