Inventories at the start of the next season on October 1 will be 20% lower than a year earlier, Jefferies Bache predicts.
Prices that rose 8.3% since December 30 will gain another 7.1% to $14 a bushel by June, the New York-based commodities trader estimates.
China signed deals in the week ended February 17 to buy 13.4 million tonne from the US, about what its own farmers grow in a year. The US Department of Agriculture anticipates record global exports
The oilseeds gains contrast with outlooks for wheat and corn, with the UN forecasting record supplies of cereals this year in response to prices that more than doubled since 2005. Soyabean futures in Chicago fell to a 14-month low in December, spurring US farmers, the worlds top growers, to consider switching more land to grains just as drought curbed harvests in South America, the largest producing region.
Tight supplies will continue until the end of next year, said Dan Cekander, the director of grain research at Newedge US, the biggest broker on the Chicago Board of Trade, where contracts for about 24.4 million tonne of soyabeans traded daily last year. The smaller crop in South America means China will buy record quantities of US soyabeans.
CBOT futures rose 19% since the December low and are trading at $13.0775 a bushel. Wheat prices that fell to a 16- month low in December are down 0.3% this year while corn has gained 0.3%. The Standard & Poors GSCI Agriculture Index of eight commodities rose 1.9%, while
the MSCI All- Country World Index of equities gained 10%. Treasuries lost 0.3%, a Bank of America index shows.
Hedge funds doubled bets on higher prices in the past month and are now the most bullish since September, Commodity Futures Trading Commission data show. The most widely held option for delivery after the US harvest gives owners the right to buy at $16 before October 26, CBOT data show. The premium for July futures over the November contract has more than tripled since February 9 to 29.25 cents a bushel, reflecting mounting concern that supplies will be tight in the first half of the year, exchange data show.
Morgan Stanleys commodities analysis team, led by New York-based Hussein Allidina, told investors in a report February 21 that they still favored buying the November contract even after the rally. Soyabeans are a better bet than corn over the next 12 months, Goldman Sachs Groups analysts, led by Jeffrey Currie in London, wrote in a report February 22. Rabobanks team, led by Sydney-based Luke Chandler, said in a report February 20 it was most bullish on beans among agricultural commodities.
Slower economic growth in China may put a brake on the rally. The country, which accounts for about 60% of imports, will expand 8.5% this year, compared with 9.2% in 2011 and 10.4% in 2010, according to the median of 21 economist estimates compiled by Bloomberg.
The nation imported fewer soyabeans for a second month in January, in part because of a weeklong public holiday, government data show.
Global growth will slow to 3.3% this year, from 3.8% in 2011, the International Monetary Fund forecast in January. The euro region of 17 nations will contract 0.5%, the Washington-based group said. The 27-nation European Union is the second-biggest soybean importer.