January 10, 2008

Rush to plant soy may spark shortage in seed supply

Seed companies may have difficulty meeting huge orders coming in for soy seed supplies as US farmers rush to plant soy this year, an offical from a unit of seed giant Monsanto said.

The rush to cash in on high soy prices is putting pressure on the industry's capability to supply soy seeds, Kevin Eblen, the head of the Delta & Pineland business unit bought by Monsanto last year, told Reuters in an interview, adding that most companies in the business are scrambling for supply.

Soy prices, which have reached US$12 a bushel on the CBOT, are also prompting cotton farmers to switch to soy.

US soy acreages are expected to rise 4 million acres to 67.7 million acres this year while US cotton plantings is expected to fall to its lowest level in 25 years. 

Cotton lost 4.4 million acres from 2006 to 2007, reaching 10.8 million acres. Another drop of 0.5 to 1 million acres drop is expected this year.