South America's soybean harvest may fall 11.6% year-over-year to 120.6 million tonnes in 2011-2012, as dry conditions in Brazil, Argentina hurt crops, Oil World says

LOS ANGELES , March 21, 2012 () – According to a report released by market researcher Oil World on March 20, South America’s soybean harvest may fall from to 120.6 million tonnes in 2011-2012, down from 136.5 million tonnes last year, Bloomberg reported the same day.

This was Oil World’s fifth outlook reduction since December.

Due to a drought across the southern region of Brazil as well as crop damage caused by the Asian rust fungus in the Brazilian state of Mato Grosso, Brazil’s soybean harvest will likely fall from 75.3 million tonnes in 2010-2011 to 66.5 million tonnes, Oil World predicted. This forecast is 1.5 million tonnes less than an earlier forecast by the market research organization.

Argentina’s soybean crop will likely fall from 49.2 million tonnes to 46.5 million tonnes after dry weather affected crops. This is 500,000 tonnes less than Oil World’s forecast in February.

Paraguay’s soybean crop will likely hit 4 million tonnes, which is less than half of the country’s soybean production the previous year.

Oil World predicted that worldwide soybean production will likely fall from 265.8 million tonnes to 243.2 million tonnes.

According to the report, the liklihood that worldwide soybean production will fall by an unprecedented amount—equivalent to a 22 million-23 million tonne loss during the 2011-2012 season.

The primary source of this article is Bloomberg, New York, New York, on March 20, 2012.

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