Global soy crop forecasts seen up again

Oilseeds analyst Oil World has revised up its forecast of the global 2009-10 soy crop again to 258.9 million tonnes, up 0.7 million tonnes from a forecast earlier in May and up by 47.6 million tonnes from last season.

This would be above Oil World's forecast of global 2009-10 soy consumption of 234.4 million tonnes, according to a report released this week.

The new production estimate is mainly due to a revision of its South American soy output estimate for 2009-10, which it now expects to rise by 37 million tonnes to about 134 million tonnes.

Oil World said the excessive supply is set to weigh on prices of soy and meal in coming weeks, noting that it is also expecting an increase of price pressure on soy and meal in the next few weeks, unless the US weather and crop prospects deteriorate.

It said the new-crop outlook in the US was also favourable at the moment due to the early start of plantings and good soil moisture in key soy and corn growing areas.

"Although current US soy supplies are tight, a bearish scenario is shaping up for US soy in the medium to longer term, as unusually strong competition from South America will hamper also the marketing of the new US soy crop next season," Oil World said.