By Benjamin Parkin
U.S. soybean farmers are due for a record harvest, even as Chinese tariffs threaten demand for the American oilseed.
The U.S. Department of Agriculture forecast on Friday that U.S. soybean production in 2018-19 would rise to an all-time high of 4.6 billion bushels, up from 4.4 billion bushels a year earlier and more than analysts expected. Soybean yields also are due to rise from the previous year.
The larger bounty will contribute to a growing domestic surplus, the agency said, with stockpiles in 2018-19 expected to climb to a record 785 million bushels, 80% above the same time a year earlier. Global soybean stocks also are due to increase, according to the USDA.
The growing supplies come after China, the world's largest consumer of soybeans, introduced retaliatory tariffs of 25% on American crops in July. That sent soybean futures at the Chicago Board of Trade to their lowest level in nearly a decade in July as traders bet that producers would be faced with a glut of the crop.
The agency expects U.S. soybean exports to fall in 2018-19 from a year earlier, though analysts expect American merchants to attract more interest from non-Chinese sources.
Soybean futures for August tumbled 3.6% to $8.55 1/2 a bushel after Friday's report.
Write to Benjamin Parkin at Benjamin.Parkin@wsj.com
(END) Dow Jones Newswires
August 10, 2018 13:23 ET (17:23 GMT)
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