Soybeans Fall as Big South America Crops May Slow U.S. Exports

May 13 (Bloomberg) -- Soybeans fell for a second straight session on speculation that record harvests in South America will reduce demand for U.S. supplies.

Brazil and Argentina, the biggest exporters after the U.S., will produce a combined 122 million metric tons (4.48 billion bushels) this year, up 36 percent from last year’s drought- reduced harvest, the Department of Agriculture said this week. World inventories were projected to rise 48 percent to a record 63.8 million tons.

“The record crops in Brazil and Argentina will hang over the market longer than people expect,” said Chad Henderson, an analyst for Prime Agricultural Consultants Inc. in Brookfield, Wisconsin. “There’s no reason for importing nations to rush in and buy.”

Soybean futures for July delivery fell 1 cent, or 0.1 percent, to $9.645 a bushel on the Chicago Board of Trade. The commodity has fallen 8 percent this year.

Prices also declined on expectations that U.S. farmers will be able to accelerate planting of the country’s second-biggest crop, Henderson said.

Warm, dry weather will return to the U.S. Midwest by May 15, firming soil to support seeding equipment after most areas received about twice the normal rainfall this week, Chicago- based T-Storm Weather LLC said today in a report to clients. About 30 percent of the soybean crop was planted as of May 10, up from 15 percent a week earlier and 13 percent a year earlier, according to the USDA.

“Weather conditions will improve and that should increase planting progress,” Henderson said.

The soybean crop in the U.S., the world’s largest grower and exporter, was valued at $31.8 billion last year, behind corn at $48.6 billion, government figures show.