An increase in the U.S. Department of Agriculture’s (USDA’s) estimate for U.S. 2015-16 soybean production added to the overall picture of a well supplied oilseeds market and turned market sentiment in more of a bearish direction.

“World soybean markets eased during November, with the IGC GOI sub-index falling by 3%,” the International Grains Council (IGC) said in its Grain Market Report at the end of November. “Despite good underlying export demand, pressure stemmed from prospects for ample global supplies, with better than expected harvest results in the U.S. and improved planting conditions in South America.”

U.S. soybean futures posted losses of up to 3% over the month on a bearish supply outlook, highlighted by USDA’s November WASDE report, which included upward revisions to forecasts for U.S. production and stocks, it said.

“U.S. dollar strength pressured, as did talk that Chinese processors had secured new crop supplies from Brazil. However, losses were limited by supportive technical features, slow producer selling and firm export interest, as Gulf values fell by $12, to $346 fob. In Brazil, where plantings for the 2015-16 harvest are seen reaching a new peak, export quotations (March) dipped by $19, to $327.

“In Argentina, spot prices declined slightly, to $345 fob, as pressure from weakness in the U.S. outweighed mild support from reluctant producer selling. ICE canola futures in Canada were narrowly mixed in November, with nearby contracts weighed by weakness in soybeans. However, losses were capped by slow farmer selling and strong local demand. MATIF (France’s exchange) rapeseed futures were little changed, mildly underpinned by tight world supplies, currency movements and concerns about 2016-17 crop prospects in Ukraine.”

The USDA’s World Agricultural Supply and Demand Estimates report for November forecast U.S. oilseed production for 2015-16 at 117.7 million tonnes, up 2.5 million from the previous estimate on increased soybean production.

It put U.S. soybean production in 2015-16 at 108.5 million tonnes, up from its previous estimate of 105.81 million, and a record level, on higher yields.

The report forecast global oilseed production for 2015-16 at 531 million tonnes, down slightly from the previous month.

“Lower sunflowerseed and cottonseed production account for most of the change with nearly offsetting increases projected for soybeans and rapeseed,” it said.

It forecast global soybean production at 321 million tonnes, up 500,000, “with the larger U.S. crop only partly offset by reductions for India, South Africa, and Uruguay.”

“The India soybean crop is reduced 1.5 million tonnes to 9.5 million on lower projected yields,” it said. “Inconsistent rainfall during the growing season and late-season heat results in below-average yields for the third consecutive year.”

Global rapeseed production is raised to 67.1 million tonnes. “Increased production projected for Canada is only partly offset by reductions for Australia, Pakistan, and Russia,” it said.

The verdict of Rabobank on the WASDE report was, “bearish, as U.S. yield boost surprises even the most bearish in the market.”

In its Oil Crops Outlook, the USDA Economic Research Service noted that “USDA anticipates higher global imports of soybeans in 2015-16 with gains for China, the European Union (E.U.), Russia, and Thailand.”

“The largest increase was for China, where imports were forecast 1.5 million tonnes higher to 80.5 million and up from 78.4 million for 2014-15,” it said. “More global trade for soybeans is likely to benefit exports from Brazil, Argentina, and the United States. An expansion of shipments from those countries would more than offset an expected reduction of trade from Uruguay, due to a smaller crop there.”

Argentine soybean shipments this fall have been robust, it said.

“Brightening prospects for Argentine exports for 2015-16 led to a forecast increase by 1 million tonnes to a six-year high of 10.8 million. This month, Brazil soybean exports for 2015-16 are forecast 550,000 tonnes higher to 57 million,” it said. “In October, old-crop soybean shipments from Brazil were winding down but nevertheless set a record high for the month at 2.6 million tonnes. By February 2016, much larger shipments may resume upon the harvesting of an expected record high 2015-16 crop.

“Rising soybean prices in Brazil have encouraged an unusually high amount of forward sales this year. Coupled with improved port logistics, that could prompt a faster increase of new-crop shipments. At the Port of Paranagua, the October completion of an expansion of ship loading capacity will shorten the time that vessels are berthed there. The new equipment also enhances the port’s efficiency by accommodating larger vessels.”