May 5, 2010

Global 2009-10 soy crop seen higher

Hamburg-based oilseeds analysts Oil World raised its forecast of the global 2009-10 soy crop to 258.2 million tonnes, up 2.7 million tonnes from its previous forecast in March, and up 46.5 million tonnes from last season.

This would be above Oil World's forecast global 2009-10 soy consumption of 234.2 million tonnes. There was "no doubt" that world soy supplies were now becoming excessive, it said.

Analysts said that there is a relatively high probability that prices of soy and meal will come under considerable pressure unless US weather and crop prospects deteriorate. Critical South American crops, now being harvested, were likely to be far above their drought-reduced levels last year, it said.

Brazil was now forecast to harvest 67.5 million tonnes, up 1.5 million tonnes from its previous estimate and up from 57.5 million tonnes last year. While Argentina is forecast to harvest 54.0 million tonnes, up 0.7 million tonnes from the previous estimate and up from the drought-hit harvest of 31.5 million tonnes last year.

Argentina's harvesting was progressing well but Oil World said it was hesitant to raise its Argentine estimate further due to fears of weather damage to soy plantings in north Argentina.