Oil World predicts that within the next several months soybean prices will drop because of improved prospects for South American crops and farmers in the U.S. planning to increase acreage.  It is becoming clear that Brazil’s soybean harvest will reach 90 million tons and Argentina’s soybean harvest is also predicted to be a record high of 55 million tons after beneficial rains.  Add to this the fact that U.S. farmers are planning to increase soybean acreage after corn fell to a three-year low, and come the fall, the market will see a large U.S. harvest on top of ample supplies remaining from a bumper South American crop.  Global demand for soybeans is still increasing.  Combined exports from the U.S and the top five producers in South America totaled 32.72 million tons for the time period of September 2013 to December 2013 – up 23% from the same period a year before. Since the marketing year began on September 1^st, China received a record 71% of U.S. soybean exports.  The U.S. and the top five South American producers crushed 40.6 million tons of soybeans into meal and oil in the same period – up 6.9% from a year earlier.  According to Oil World other factors that could drive down soybean prices in 2014 are the decreasing demand for biodiesel in the U.S. and Argentina and high supplies of other oils and competing products such as sunflower oil.

 

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