The world’s oilseeds market has taken on a bearish look as the South American crop is harvested and traders worry that China’s demand for soybeans for feed may not be as great as thought.

Rabobank lowered its price forecast for CBOT soybeans on weaker Chinese demand and a reduced CBOT corn price forecast.

“The USDA’s bearish reports in March combined with weak Chinese feed demand caused nearby CBOT soybean prices to close below $13.70 per bushel for the first time since early June 2012,” it said. “Selling by managed money has added downward pressure.”

However, supplies remain near record-low levels in the U.S., and logistical constraints in South America are likely to continue to keep nearby prices supported, it said. “We expect higher year on year U.S. soybean production, and the long tail of South American soybean exports will result in prices falling to or below $12 per bushel by the end of 2013.”

Weak Chinese soybean imports are likely to prove bearish for CBOT soybean prices, it continued. “Since November, feed demand in China has been less robust than last season, with soybean imports between October and March dropping 9% year on year to 25.6 million tonnes.”

Flat consumer demand growth, largely unchanged animal numbers, and decreasing feed use intensity have limited China’s feed consumption at a time of low worldwide availability, it said.

“The current avian influenza outbreak, which has over 50 cases already reported, exacerbates this situation,” Rabobank said.

According to the International Grains Council (IGC), world soybean output in 2012-13 will be up 11% year on year on a rebound in South American crops. It puts the total crop at 266 million tonnes, compared with 238 million in 2011-12.

“The global 2012-13 soybean carryover is expected to rise modestly,” the IGC said. It forecast trade up 5 million tonnes at 97 million, “centered on larger deliveries to Asia, particularly China.”

The IGC has trimmed its forecast for Brazil to reflect the impact of difficult weather in center-west areas, including the key state of Mato Grosso.

“Nevertheless, with all regions, and especially those in the south, expected to harvest bigger crops, production is forecast to rise by 24% year on year, to an all-time high of 82.1 million tonnes,” it said.

Even though it notes that February rains generally arrived too late to boost yield potential in the driest areas, the IGC’s 2012-13 forecast for Argentina is, at 48.5 million tonnes, a year-on-year increase of 9 million.

“The increase in production in the southern hemisphere will more than compensate for a smaller U.S. crop,” the IGC said, citing an official estimate of U.S. soybean production in 2012-13 at 82.1 million tonnes, down from 84.2 million the year before. U.S. production is expected to recover.

“The USDA is projecting a strong rise in U.S. soybean production in 2013-14, by 13% year on year, to an all-time high of 92.7 million tonnes,” the IGC said. “Plantings are expected to expand only marginally from the previous year, to 31.4 million hectares, boosted by a decline in cottonseed sowings and opportunities for double cropping with SRW wheat. The projected bumper outturn is driven by a significant improvement in average yields following last year’s severe Midwest drought.”

Predicted U.S. yield of three tonnes a hectare is 12% up on the year.

The IGC expects global soybean use in 2012-13 to expand to 263 million tonnes (from 252 million), boosted by an expanded crush as processing increases in a number of key consumers.

“Consumption in China is forecast to expand further,” the IGC said, “rising by 8% year on year, to 76.1 million tonnes, on strong demand from both animal feed and food sectors.”

The USDA attaché in Brazil has predicted record 2012-13 soybean production at 82 million tonnes on 27.65 million hectares and record exports of 38 million tonnes.

“Deficient infrastructure and logistics to bring the crop to market have adversely affected Brazil’s competitiveness in 2013, a scenario expected to repeat in the future as production growth outstrips infrastructure improvements,” the attaché said in a recent report.

For the following year, 2013-14, the attaché forecasts an increase in area to 28.25 million hectares, yielding a record 85 million tonnes.

The USDA attaché in Buenos Aires puts the Argentine soybean crop this year at 48.5 million tonnes. “It is another difficult year to measure average national yields as planting dates and crop conditions vary throughout the country,” the attaché said. “Heavy rains in October, November and early December prepped the soil and offset some of the damage that could have been done by the 60- to 70-day drought from mid-December through mid-February.”

In Europe, rapeseed area for harvest 2013 is set to increase.

“The E.U.-28 rapeseed area for harvest 2013 is estimated to increase compared to 2012, when major producing regions reduced plantings and experienced significant winterkill,” the U.K.-based HGCA said. “The E.U. Commission, in its latest Short Term Outlook, forecasts the 2013 E.U.-28 rapeseed area to increase to 6.74 million hectares. This is up 8.6% compared to 2012, despite estimated decreases for the UK (-7.7%) and France (-5.7%).”