AUBURNDALE — The Coca-Cola Co. said Tuesday that it is spending $2 billion to support the planting of 25,000 acres of new orange groves in Florida, a move officials are lauding as a major investment in the Sunshine State's citrus industry.
The announcement was made at a news conference at Coca-Cola's juice production plant in Auburndale.
Coca-Cola will buy fruit from two growers: Peace River Citrus Products in Vero Beach and Cutrale Citrus, one of Brazil's top growers and juice processors.
Cutrale Citrus' entrance to Florida as a grower is significant, said Florida Agriculture Commissioner Adam Putnam.
"The fact that one of the dominant Brazilian players will now have an ownership stake in actual production in Florida is a tremendous development," Putnam said.
Coca-Cola owns the Minute Maid and Simply juice brands and already buys juice from Cutrale in Brazil. Coca-Cola is also a significant juice processor in Florida — Tuesday's news conference was held at the largest juice bottling plant in the United States.
Some 5 million trees will be planted in the new groves, believed to be the largest citrus addition in the state in at least 25 years. The groves will be in Polk, De Soto and Hendry counties in Central Florida.
Analysts say that the announcement intensifies the juice wars between Coca-Cola and PepsiCo, which owns the Tropicana brand.
"This shows Coke's commitment both to the Florida citrus business and the future of its own juice business," said John Sicher, editor and publisher of Beverage Digest.
Coca-Cola officials say the new groves and resulting juice production are expected to add about 4,100 jobs to Florida's economy.
The move also is seen as a boost to historically declining acreage devoted to citrus production in Florida. During the state's past housing boom, many citrus farmers sold their land to developers. Since 1997, total citrus acreage has fallen by 25 percent, from 600,000 acres to 450,000 acres, because of disease, pests and other pressures, according to Florida Citrus Mutual.
Coca-Cola officials said that the Florida Citrus Commission is working on an economic study centered on the company's investment, and that a preliminary draft shows that over the course of 25 years the expansion will add more than $10.5 billion — or $422 million per year — to Florida's economy.