Irish soya bean prices could drop by just over 6% between now and the beginning of the October, according to Rabobank analyst Tracey Allen.
“This prediction is based on the large harvest now coming through from South America and the estimated spring planting levels in the US,” she said.
“Farmers in Brazil are actively selling significant quantities of soya beans at the present time. And these tonnages are getting out of the country without major holds ups being incurred.
“Demand for soya is reasonably stable at the present time. And we do not see any new entrant coming into the market over the coming months with the wherewithal and intent to drive up prices.
“We are projecting a slightly higher planting acreage in North America than is the US Department of Agriculture. This is on the back of our belief that US growers have the scope to draw down a higher soya acreage in 2015.”
The London-based analysts explained that a strong growth in demand for soya meal in China, allied to logistical problems in the US – in terms of physically exporting product – led to a spike in soya prices last autumn.
“I know this had an upward effect on the prices paid at farm level for Irish ruminant rations at the time,” she said.
Rabobank is also predicting that the US dollar: euro exchange rate should remain pretty stable between now and the beginning of this year’s fourth quarter.
“At the present time the dollar is buying €1.05 and we see this still being the state-of-affairs come the autumn. And if this turns out to be the case, then currency issues will not act to impact on the projected reductions in soya prices later this year,” said Allen.