Hamburg-based oilseeds analysts Oil World said on Tuesday it has again cut its 2009 soybean crop forecasts for key exporter Argentina, this time by one million tonnes, because of drought in the country. It now estimates Argentina will harvest 43.0 million tonnes of soybeans in early 2009, down from its January 27 estimate of 44.0 million tonnes and down from the country's 2008 harvest of 46.7 million tonnes.
In early January Oil World expected Argentina to harvest 48.8 million tonnes this year. But it has kept its current forecast of Brazil's 2009 crop of 57.5 million tonnes, down from 60.02 million tonnes harvested by Brazil in 2008. "World supplies of soybeans have tightened considerably as a result of the severe crop losses in South America," it said. "Rainfall in the last week of January was considerably lower than forecast and much too scattered to bring the desired relief."
It added: "Argentine soybean and corn crops are suffering most. According to our new assessment, an estimated 21 million tonnes of the oilseed and grain crops have been lost up to end-January due to drought, smaller areas and reduced application of fertiliser and other inputs." Argentina's 2009 soybean crop could fall even lower and a harvest in the range of 41 million to 44 million tonnes is possible, depending on rain in coming weeks, it said.
Combined soybean harvests in the key South American producing countries could fall to 108 million tonnes in early 2009, down 8.4 million tonnes on the year, it said. "With production and export supplies shrinking in South America, the world market will become increasingly dependent on US supplies," it said.