Why don’t we drink orange juice anymore?

So I looked up the other day— I'm almost 50— and realized that, uh, I don't drink orange juice anymore, and nobody I know drinks orange juice anymore. And it happened to coincide with the same day I was scrolling through Twitter and I saw this particular chart. And it's a chart of orange juice prices, which is showing for March delivery here in 2025, the orange juice prices are absolutely cratering. So to me, this was a sign to go dig into this. And I saw some incredible stuff. I saw number one, that orange juice prices are the highest they've ever been. But at the same time, people are not drinking orange juice and the production and the consumption is the lowest it's ever been. So there's some fascinating stuff going on in the orange juice world and some stuff for us to learn as entrepreneurs from all this. So that's what this video is about. And stick around. Hi, my name is Michael. If you're new here, I like to record videos about business. I am a business nerd. I've started companies, I've sold some companies, I've had some huge successes and I've had some not so huge successes. And I love to teach and I love to nerd out about this stuff. So that's what this channel is about. If you like that kind of stuff, give us a follow, give us a subscribe. It would make me feel good because I do these on vacation, which I'm on vacation right now, and it makes my wife happy to see me happy about subscribers. So there you go. All right. So let me show you this very first chart. This is the first kind of conundrum of the orange juice situation, which is Americans are drinking less and less orange juice. So basically domestic consumption of orange juice, you can see this chart, went from 865,000 metric tons in 2008, 2009 to basically 60% of that. So basically a 40% decrease in the consumption by 2022, 2023. It went down to 500,000 tons. Like, so that's the first thing to know about the orange juice market. People just aren't drinking the stuff anymore. It's losing 4% of its size every single year on average. Just crazy. It's $4.50 on average. When I was a kid, or let's say in the early 2000s, that was $2. Some of this is because prices are just crazy. So this is frozen concentrated orange juice. If you watch the movie Trading Places, hopefully we'll edit in a clip of that. And then there are other commodities like frozen orange juice. That was what they were trading. That's what ruined the two rich old white guys. Anyway, that's an aside. But frozen concentrated orange juice, orange juice, like they freeze it, they put it in a little tube. Like when I was a kid, they put it in a little tube, the paper tube, and your mom would mix it into a big jug. The price appreciation of this has just been incredible. So you look at it, so it's 2.5 times more expensive. So first thing to know is that orange juice is like getting really expensive and not that appealing. And look, like when I walk in and I see something like this, this particular picture of Simply Orange juice, which to me looks like a giant jug of sugar, for $7 and they're telling me it's organic and plant-based, like that does not look healthy to me. It's a plastic jug full of sugar. And I think a lot of other consumers are seeing the same thing. All right, so, and like here's the story dating all the way back to the '60s, right? You look and we were drinking per capita 67 pounds equivalent per person back in 1960. Like that is a lot of orange consumption. And then it peaked around 1980, right? And then it came back again in the late '90s. And if I remember the late '90s correctly, that was kind of the peak of the low-fat craze when everybody thought that being healthy involved not eating a lot of fat. And we were all still, still hadn't figured out that doesn't work. But then you can see where it kind of topped out there. And by 2000, it started to come down. Look at the poor tangerine. Nobody loves a tangerine. They're better than oranges, frankly. But hey, and so this next data point, this is super important to our story. Because orange juice consumption, it turns out it's not like an egalitarian domestic thing. It's mostly and historically rich people of people that were drinking, uh, orange juice. So here, this particular chart shows that it was a luxury item. And here, the percent of people that are drinking a ton of orange juice, they're people that make 350% or more of the poverty level of America, right? So poor people and normal people are not drinking orange juice. It's the rich people doing it. And that ties into what's happened with consumption. And when they were— those rich people, when they were drinking orange juice, they were doing it at home. They would have a sit-down breakfast and they would drink orange juice and eat oranges sitting at their house. You didn't eat them at restaurants. They didn't show up at school. They didn't show up at fast food. Like, they were showing up the vast majority of time in people's houses when they sat down for breakfast. And look, like, I grew up in a pretty privileged background, like, totally blessed with what I have. This is what breakfast looked like a lot of times for us in the '90s and the '80s. It was a big bowl of sugar, a big piece of toast with a big slab of, big slab of butter on it, and some sugary fruit, and then 2 more cups of sugar in the case of milk and orange juice, right? It was part of a complete and balanced breakfast from the '90s. Like, this is the way we were eating back then. I don't know anybody that eats this breakfast anymore. And so this shows what happened, right? Which is we have upscale people who are doing sitting-down breakfasts and they're expected to drink orange juice. But something happened, which was the internet, social media, all that kind of stuff came along, and we started to see things like the Zone Diet, the vegan diet, low-carb diet, the paleo diet, the keto diet. Like, those things all started to show up en masse around 2000, and they started to accelerate in terms of adoption. And so right here, this chart is showing the interest over time of Google searches for these things, right? It— what, what was kind of a slow boil or a slow rumble in the early 2000s, by the mid-2010s became just a total roar of people changing their attitudes towards what orange juice should do for them. And these people, if you look at all those diets, like, they don't want a cup full of orange juice sugar. Like, they don't want it. And this has culminated now in terms of a ton of just media influence that is like telling people drinking orange juice is a cup of sugar, it's not good for you. Frankly, I agree with them. Like, I don't, I don't drink orange juice. I can't remember the last time I had orange juice. So I went and spent some time going through, and this website came up amongst hundreds of other ones. And they're like mom influencer type websites. And this one had 23 make-ahead breakfast recipes where you can like have a healthy breakfast that doesn't look like that one I showed you before, right? This honeycomb thing, right? And these are like steel-cut oats and berries and all this kind of stuff that you can make ahead of time. Uh, chia seeds, like just kind of what you expect. Uh, guess how many of these 23 recipes in this particular site had orange juice in them? One. And it was a tiny little fresh-squeezed thing of orange juice. Like the idea of drinking, uh, concentrated orange juice from a can, like was not part of what, uh, Kate here, uh, recommends to people. Like, I Googled breakfast and said, show me pictures of breakfast, and here's what Google showed me. Uh, look how little orange juice you see in these pictures. It's all high fat, high protein, relatively low carb. You might see some bread stick in there, but you know what you don't see? Orange juice. There's some in there. I see 2 orange juices out of the whole bunch and an orange slice, but by and large, like, the popular idea of what breakfast is has gotten rid of orange juice. Like, We just don't think it's normal to drink orange juice anymore. So the tide is turning against the social media and now media against people wanting to drink orange juice. And I went through Twitter also and looked at how people were talking about orange juice. This particular line really stuck out to me. I don't know a soul who still drinks this liquid sugar. That's how he was describing orange juice itself. And look at this guy's age. He's about my age, looks to be about 50. Um, like, we're over it. The population and our interest has totally changed. And so this was telling to me, uh, this was— this chart only goes through 2012, but orange juice consumption has been sliding since the late '90s, like just getting killed by low carbs and changes in terms of the way people approach breakfast and all those kinds of ideas. But interestingly enough, apple juice still going strong. Don't know why. It's kind of nasty. So that leads us back to why we are asking this question, which is like, okay, well, like, if people want less of this stuff, supply and demand says if people demand less of a thing, the price should go down, right? Um, because people lower their, their, their stuff in order— their prices in order to sell it. But prices keep going up, so what's going on? Well, it turns out the other half of the story is that the supply side of oranges absolutely getting brutalized. And it looks like this. So here's a chart showing, uh, the production of 90-pound boxes of oranges, uh, from Florida and California. And while California stayed relatively flat, Florida has gotten absolutely brutalized. It peaked around the year 2000 at 300 million boxes, and now production in Florida is back down to the lowest it's been since 1937. Like, we didn't even have highways back then. Pretty crazy. Like, they just barely had radio. And here's the reason. The reason is, uh, there is a massive blight. It's a pest. It's a pest-based disease called citrus, um, citrus blight, I think exactly it is. I'm quoting the wrong thing, but basically there is this pest that has come in and attacks all these citrus groves and injects a bacteria into the trees, and it just absolutely wrecks them, and they all die a few years later. And there's just no defense. Nobody from a scientific standpoint, the USDA, nobody has figured out how to do this. So you're seeing entire groves of Florida, in Florida, just getting totally wrecked. And what's scary about this particular blight and is shutting down so much of the production is it's starting to show up in some of these other markets. Brazil produces a lot of oranges, Egypt, Mexico, other places. Some of those places like Brazil are fortunate because they have different layouts of their groves and stuff like that. So they're a bit more resistant. To this particular pest. But they're still— we're starting to see lots of problems in some of these other markets. So that's what's hurting supply in addition to what's going on with hurricanes, right? Hurricanes historically would come in, wreck production, and then they would move on and it would recover. But when you combine the hurricanes that we've had recently over the past couple dozen years with what's going on with this pest, like, that's why supply is going down. So it's a fascinating situation. Where we have reduced supply of orange juice and we have reduced demand of orange juice and still prices are going through the roof and we're seeing massive inflation in those things. So leads to an intensely volatile type environment and hence back to our original chart of like, why is the orange juice market totally crazy? Well, because of this. Just totally fascinating how it got here, you know, and you look back on what these farmers have gone through. And there's just a lot of bad luck here. Like, if you wanted to buy into this industry in the late '90s, like, you probably had no idea that this blight was gonna come along and that hurricanes were gonna kill you and climate change was gonna come after you and that consumer sentiment was gonna change. And they look up and a lot of them are going bankrupt or they're selling their fields of orange trees and letting developers turn them into houses. Just a bizarre turn of thing. And to me, just a takeaway of how much luck plays into business. And the really smart and humble business people I know, they really appreciate how much luck plays into their success. I think that's, that's the big takeaway from this video for me. So tell me what you think. Thanks for being here.