US soy prices to fall on looming big global crop

 

 

A large upcoming global soy crop, especially in South America, is set to reduce soy and soymeal prices in coming months, Hamburg-based oilseeds analysts Oil World forecast on Tuesday (Jan 26).

 

"There is considerable downward potential for soy and meal prices in January-June 2010," Oil World said. "The price pressure will be mainly in soymeal and soy."

 

Global 2009-10 soy production is forecast by Oil World to rise to 252.09 million tonnes, sharply up from 212.07 million tonnes in 2008-09.

 

Oil World on earlier forecast major crop increases in key South American producers Argentina and Brazil.

 

Early harvesting has already started in Brazil and increasing volumes of Brazilian beans will enter the world market in February with sales gaining momentum in early March, it said.

 

Global soymeal supplies will remain tight up to March, and then the new South American supplies will become increasingly available, it said.

 

Global April-September 2010 soymeal production is forecast by Oil World to rise to 84.9 million tonnes from 78.5 million tonnes in the same year-ago period.

 

"World production will rise faster than demand, resulting in an accumulation of soymeal stocks and price pressure," it said.

 

However, soyoil prices are likely to remain stable partly because of tight supplies of other edible oils and firm demand, it said.

 

According to Oil World, soyoil prices will stay comparatively firm, with soyoil increasing its share of the combined product value, financing a larger part of the crush margins in the months ahead.