World Grain - January 2013 - 32

FEATURE: GRAIN AND OILSEED MARKETS

million tonnes — a record high.”
Rabobank said corn is forecast to
continue winning the battle for acreage
in the U.S., which will result in only a
modest expansion in Northern Hemisphere soybean output.
“We expect China’s demand will remain strong, rising to nearly 30% of
global soybean consumption, up from

only 15% 10 years ago,” Rabobank
said. “Seemingly inelastic demand
from China will increasingly price other major importing countries out of the
market and will also result in a historically high ﬂoor price for international
soybean values. Even with trend yield
assumptions, the global soybean balance sheet is likely to remain tight in

GRAIN DRYER

EXPERTS

y
y
32

For more information, see Page 98.

2012-13, leaving little room for error.”
Rabobank expects South America’s
soybean output to recover 30% from
year-ago levels to reach record levels in
2012-13 and be a bearish factor for prices.
However, Brazil’s output will fall below
USDA’s November forecast of 81 million
tonnes as Rabobank’s estimates show
more modest area and yield expansions.
“We forecast Brazil’s harvested area
in 2012-13 to reach 26.9 million hectares, which would be the largest yearon-year increase in eight years, after record high prices have encouraged farmers to plant more.”
Argentina’s harvested area is also
expected to increase, reaching a recordhigh 20 million hectares in 2012-13.
The report said U.S. soybean area
planted is likely to decline slightly year
on year in 2013-14, and the price ratio to
corn is expected to remain below 2.3 in
early 2013 in order to incentivize higher
corn area. U.S. soybean stocks-to-use
are forecast to decline 0.8% year on year
to 4.6% as production falls to a ﬁve-year
low of 2.98 billion bushels in 2012-13.
China soybean import demand will be
a key bullish factor for CBOT soybean
prices in 2013.
“We forecast China’s soybean imports to rise 6% year on year to 62.5
million tonnes for 2012-13 and a further
7% in 2013-14 to 67 million tonnes,”
Rabobank said. “We believe China’s
structural shift toward increased soybean imports will persist. Evidence of
this can be seen through the continued
growth of crush capacity near key coastal areas and government-set prices for
soybeans, which have tended to be low
in relation to set prices for corn or rice.
Rabobank forecasts China’s domestic soybean crop for 2012-13 to be 9%
below USDA’s November forecast, with
a further 3% drop likely in 2013-14. At
the same time, the report said the economics of crush margins will continue
to play a diminished role in predicting
import pace.
We want to hear from you — Send comments and
inquiries to worldgrain@sosland.com. For reprints of
WG articles, e-mail reprints@sosland.com.

January 2013 / World Grain / www.World-Grain.com

http://www.mathewscompany.com http://www.World-Grain.com

World Grain - January 2013

Table of Contents for the Digital Edition of World Grain - January 2013