Global production of soybeans may be bigger than previously estimated as prospects improve for crops in South America, Oil World said.
World soybean output may be 4 million to 5 million metric tons larger than previously expected, the Hamburg-based researcher said in an e-mailed report, without providing a specific production forecast. The company pegged the 2013-14 global harvest at 281.3 million tons in its last monthly report released Oct. 22, 5.4 percent larger than a year earlier. Oil World raised its production forecast for Paraguay and said recent rainfall in Argentina means farmers will boost planting.
“Record-breaking world supply fundamentals are bearish,” Oil World said. “World production of soybeans is likely to turn out sizably above our estimate a month ago, creating a larger-than-expected production surplus, despite strong demand.”
Soybean futures slid 7.4 percent this year on the Chicago Board of Trade, the global benchmark, amid an outlook for larger supplies. The U.S. Department of Agriculture raised its forecast for world output on Nov. 8 to a record 283.54 million tons from a forecast of 281.66 million tons in September.
Planting in Argentina, the world’s third-biggest exporter, may cover at least 20.5 million hectares (50.7 million acres), 4.6 percent more than a year earlier, Oil World said. Paraguay’s harvest may be a record 9.3 million tons, and “excellent weather” means some private analysts peg production as large as 9.6 million tons, it said.
Brazil, the top exporter, has made “very good progress” in planting this year, and some farmers are considering planting quick-maturing varieties of the oilseed as a secondary crop in January instead of corn, Oil World said. Some crops are at risk of damage from a new type of ear-worm that has emerged in Mato Grosso, Mato Grosso do Sul and Goias states, where farmers have increased use of insecticides.
Demand for the oilseed also is increasing, with China purchasing a record 21.1 million tons of U.S. supplies for shipment this year, as of Oct. 31, compared with 16 million tons a year earlier, Oil World said. China, the world’s biggest buyer, may import about 69 million tons in the 2013-14 season that began Oct. 1, 9 million tons more than the prior year, according to the report.
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