September 18, 2010

US soy prices unlikely to stay high

As inventories are ample and harvesting is expected to pick up, US soy prices are unlikely to stay at current levels for much longer, according to Thomas Mielke, a respected oilseeds industry analyst.

"I expect soy prices will have difficulty to sustain recent high prices of US$10.50 per bushel once harvesting expands and farmer selling picks up," Mielke, head of oilseed research group OilWorld, told a regional grains conference in Vietnam.

"Soy supplies are ample and are likely to stay ample in the next six months," Mielke said in his address.

Soy for November delivery <Sc1> rose 1.2% on Friday (Sep 17) to stand at US$10.49-1/4, their highest level in a month.

Although the US is expected to reap a record soy crop this year, some analysts fear dry weather in South America could threaten plantings in the key soy producing region.

Sustained rain is needed over the next two to four weeks for the planting of good size crops in Brazil, the no.2 soy exporter after the US.