July 14, 2010

Oil World forecasts larger US 2010/11 soy crop

The US 2010/11 soy crop is likely to rise to 92.3 million tonnes or 3,390 million bushels, up from 91.42 million tonnes in 2009/10, Hamburg-based oilseeds analysts Oil World forecast on Tuesday (July 13).

This was above the USDA's Friday (July 9) estimate of 91.04 million tonnes.

"During the past two weeks crop conditions deteriorated slightly in the US but they are still in line with last year and comparatively favourable in the historical perspective," Oil World said.

"We assume normal weather during August. However, if it becomes unfavourably dry, as some observers expect, we will have to make downward revisions."

But the global 2010/11 soy crop is forecast by Oil World to fall to 255.79 million tonnes from 260.97 million tonnes in 2009/10 partly because of an expected fall in South American crops.

Argentina's 2010/11 soy crop for harvesting in early 2011 is forecast to fall to 51 million tonnes from 55 million tonnes in 2009/10 and Brazil's to 66.5 million tonnes from 68.71 million tonnes.

"Argentine soy plantings for the crop of early 2011 are likely to decline as some acreage will be shifted to wheat and sunflower seed," it said.

"Prices of meat have increased to very attractive levels in recent weeks, which could imply an expansion in cattle raising on marginal areas which may partly occur at the expense of soy plantings."

Exceptionally high soy yields in the 2010 soy crop were unlikely to be repeated in early 2011 in Argentina or Brazil, it said.