February 28, 2014
Oil World cuts South American soybean production estimate
Soybean production in South America will be 4.4% less than previously expected, led by a decline in Brazil''s crop due to dry weather, according to Oil World.
Oil World expects Brazil''s crop, the world''s second-biggest, to be 85 million tonnes in the 2013-14 season, below an estimate of 89.5 million tonnes made last month, and lower than the estimate of 90 million tonnes by Conab, the the Brazilian government''s forecaster.
Argentina''s harvest will be 53 million tonnes, less than the previous forecast of 54 million tonnes due to excessive rains. The Hamburg-based researcher also cut its outlook for Paraguay, Bolivia and Uruguay, leaving output in the top-five producing countries at 151.8 million tonnes, compared with 158.8 million estimated in January.
"Considerable irreversible losses have already occurred from drought," Oil World said. "There is a high risk that a further downward revision will become necessary for Brazil if the urgently required rainfall does not arrive in Rio Grande do Sul, the southern-most state, in the next two weeks."
Oil World projects world production of soybeans to be 280 million tonnes, 7.8 million tonnes less than estimated last month. Output will still be 4.7% larger than a year earlier, according to the report. Global inventories at the end of the 2013-14 season will be 73.1 million tonnes, up from 63 million tonnes a year earlier.
Soybeans have climbed about 6.1% this year on the Chicago Board of Trade, the global benchmark, due in part to concerns about the South American crops.