By Jeff Wilson March 10 (Bloomberg) -- Soybean futures are likely to plunge 12 percent by June as record harvests in Brazil and Argentina flood the market the same way they did in 1998, according to Anne Frick at Prudential Bach Commodities LLC. The supply-demand pattern from 12 years ago, when rising output halted a drop in stockpiles, is creating a “road map for potential price action” this year, said Frick, a vice president for research in New York. Soybeans for July delivery, after the South American harvests, will slip to $8.46 a bushel on the Chicago Board of Trade by June from $9.56 yesterday, she said. Production in Brazil and Argentina, the biggest exporters after the U.S., will jump 34 percent this year to a record 119 million metric tons, the U.S. Department of Agriculture said last month. In 1998, harvests in the two countries surged 35 percent to 52 million tons, a record at the time, reducing demand for U.S. supplies, Frick said. “Brazilian soybean exporters usually do not hit their full stride until April,” Frick said in a March 5 report to clients. “We expect the two-stage downswing in July soybean prices to a low in June,” after slipping to $8.65 in April, she said. In 1998, the July futures contract fell 9.7 percent from March 10 to June 9. At the time, rising supplies from South America helped boost global inventories that had declined the previous two years, Frick said. World reserves jumped 74 percent to 27.6 million tons in October 1998, after slipping to 15.9 million a year earlier, USDA data show. This year, stockpiles are expected to surge 44 percent to 59.7 million tons on Oct. 1, halting two years of declines, the department said last month. Soybean meal, an animal feed produced from the oilseed, will lead the soybean market lower as demand for U.S. supplies shifts to Brazil and Argentina, Frick said. Meal futures for July delivery should fall 17 percent to $216 for 2,000 pounds by June, Frick said. U.S. farmers begin sowing the crop in April, and prices may rally in July if weather disrupts planting or early growth, Frick said. --Editors: Steve Stroth, Patrick McKiernan. To contact the reporter on this story: Jeff Wilson in Chicago at jwilson29@bloomberg.net To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net.

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