ICE contracts on 15,000 pounds of frozen concentrated orange juice solids, a small, thin market driven almost entirely by Florida and Brazilian weather and disease.
OJ is the smallest of the mainstream softs and the least liquid, with open interest in the low tens of thousands of contracts. Florida hurricanes, freezes and the spread of citrus greening disease have shrunk the US crop dramatically, and Brazil now supplies most of the world's concentrate.
Its thinness makes it a poor market for size and a famous one for stories — it is the contract at the centre of the film Trading Places, whose plot turns on advance knowledge of a USDA crop report.
Example: OJ at 400 cents a pound is $4.00 x 15,000 = $60,000 per contract. A 20-cent move is $3,000, and the bid-ask in deferred months can be several cents wide, far more than a grain trader would tolerate.
Original diagrams for the ideas on this page. Illustrative, not real market data.
The bid-ask spread. Buy orders sit below, sell orders above, and the gap between the best bid (50.01) and best ask (50.04) is the spread you pay to cross. Bar length shows the size resting at each price.
Educational only, not advice. Spotted an error? Post in Site Feedback.