Soybean production in South America will be 4.4 percent less than previously expected after dry weather hurt crops in Brazil, Oil World said.
Brazil’s crop, the world’s second-biggest, will be 85 million metric tons in the 2013-14 season, below an estimate last month of 89.5 million tons, the Hamburg-based researcher said in an e-mailed report. Argentina’s harvest will be 53 million tons, less than the previous forecast of 54 million tons, because of excess rain. The researcher also cut its outlook for Paraguay, Bolivia and Uruguay, leaving output in the top-five producing countries at 151.8 million tons, 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."
Soybeans have climbed about 6.1 percent this year on the Chicago Board of Trade, the global benchmark, partly on concern about South American crops. Oil World’s outlook for Brazil’s harvest compares with an estimate of 90 million tons from Conab, the South American country’s government forecaster.
World production of soybeans will be 280 million tons, 7.8 million tons less than estimated last month, Oil World said. Output will still be 4.7 percent larger than a year earlier, according to the report. Global inventories at the end of the 2013-14 season will be 73.1 million tons, up from 63 million tons a year earlier.
Total production of seven major oilseeds, including soybeans, rapeseed, sunflower seed and palm kernel, will be 483.5 million tons, 7.4 million tons less than previously estimated while still 5.3 percent larger than a year earlier, according to the report.
"Oilseed supplies will be much smaller than expected this season, but still well up from 2012-13," Oil World said. "Detrimental weather conditions have severely reduced South American production prospects, primarily for soybeans but also for other crops like corn and sunflower seed."