March 19, 2008

World soy output to be short of 18 million tonnes
 

World soy output for 2007-2008 will reach 221.3 million tonnes, way below the forecast consumption of 239.5 million tonnes, according to a report by Hamburg-based oilseeds analysts.

That means there would be a global soy shortage of 18 million tonnes, a stark contrast to 2006-2007 when soy output was 237.8 million tonnes and soy consumption was 225.3 million tonnes, and there was a 12.5 million tonnes soy surplus in supply.

Clearly, the deficit was caused by decreased output but increasing consumption, despite there was a recent boost in production estimates for key producers Brazil, Argentina and India. 

A significant reduction of stocks by about 18 million tonnes will be essential during August and September of 2007-2008, according to the report.

The report estimates that global ending stocks in 2007-2008 will be 54.5 million tonnes, down 25 percent from 72.6 million tonnes at the end of 2006-2007.

Argentina's decision to increase export taxes on soy and soy products to promote wheat and corn output may have a considerable impact on world markets, said the report. 

The report added that further expansion of soy plantings in Argentina could be more moderate than expected and that these developments are likely to push up world market prices of soy and soy products in the long term.

Argentina accounted for 59 percent of global soy oil and 49 percent of global soymeal exports in 2007.