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USDA Market News Helps Minneapolis Grain Exchange Launch Apple Juice Contract

The USDA Market News Division of the Agricultural Marketing Service (AMS) works with various processors, buyers and brokers to track a wide variety of commodities. Since September 2010, USDA Market News has been reporting apple juice concentrate (AJC) prices as part of the National Apple Processing Report.  This report also includes information on prices for apple varieties, shipments, and quantities utilized in the processing of apples on a weekly and yearly basis.

The Minneapolis Grain Exchange, a Designated Contract Market and Derivatives Clearing Organization, announced the official launch date for its new apple juice concentrate futures and options contract on August 13, 2012. The exchange developed the apple juice concentrate contract after thorough preparation and collaboration with many segments representing the apple juice industry as well as USDA, AMS, Fruit and Vegetable Market News.

A glass of apple juice in the morning sun.  Apple juice concentrate is a multi-billion dollar industry with a 6 percent growth rate each year.  USDA’s Market News provides cash market pricing for apple juice concentrate as part of its National Apple Processing Report.  Photo courtesy Keith Williamson

A glass of apple juice in the morning sun. Apple juice concentrate is a multi-billion dollar industry with a 6 percent growth rate each year. USDA’s Market News provides cash market pricing for apple juice concentrate as part of its National Apple Processing Report. Photo courtesy Keith Williamson

The Minneapolis Grain Exchange responded to the needs of the apple juice concentrate industry by providing transparency in the price discovery process and a tool for additional risk management for all apple juice concentrate market participants. The availability of accurate, reliable public pricing is a key component of a successful futures contract and ties into the AMS mission to facilitate the competitive and efficient marketing of agricultural products. The Minneapolis Grain Exchange enlisted the USDA’s Fruit and Vegetable Market News Division – to report cash market prices for apple juice concentrate.

The vast majority of apple juice concentrate consumed in the U.S. and around the world is produced in China, South America and Europe.  A multi-billion dollar industry, the product has experienced a rate of nearly 6% growth per year as worldwide demand increases for more natural methods of sweetening processed foods.  For the apple juice concentrate processor, a contract offers the ability to protect inventory value and manage price risk prior to their eventual cash market sale. For the apple juice concentrate cash buyer, a contract can help protect profit margins by strategically setting a price, via substituting futures, in advance of their cash product needs.

The USDA’s Market News adapts its reporting to accommodate the many diverse operations of our customers in the produce industry and all of agriculture. AMS is committed to supporting all agricultural business models and Market News is just one of the many ways we empower businesses – both large and small.

Market News reports give businesses the information they need to evaluate market conditions, make purchasing decisions, monitor price patterns, evaluate transportation equipment needs and accurately assess movement. All of these tools help them identify future trends and much more.  Our USDA Market News Division has been providing price, demand and volume information on cotton, dairy, livestock and grains, poultry and eggs, and fruits and vegetables for over 95 years.

Visit USDA Market News on the AMS website to view hundreds of pre-made reports—including the National Apple Processing Report—or create a custom report to see only the information you need.  Compete Smarter – with USDA Market News!

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