Last year's small South American soybean crop is expected to provide increased U.S. export opportunities this year, according to USDA's June 10 World Agricultural Supply and Demand Estimate. But South America is expected to rebound in 2005-06 and contribute to a projected world record crop in 2005-06. Here are highlights from the report:

Soybeans

USDA increased soybean crush and exports and reduced ending stocks from the 2004-05 U.S. crop and also reduced global ending stocks. The latter reflects the ever-shrinking Brazilian crop, now down to 53 million tons.

The resulting decrease in ending stocks for South America is expected to increase 2005-06 U.S. soybean exports by 10 million bushels to 1.135 billion bushels.

U.S. soybean ending stocks for 2005-06 are projected at 255 million bushels, down 25 million bushels from last month. The U.S. season-average soybean price for 2005-06 is projected at $4.95 to $5.95 per bushel, up 25 cents on both ends of the range.

Global soybean production for 2005-06 is projected to increase 3.4 million tons to a record 219.7 million tons. Although U.S. soybean production is expected to decline from last year's record level, a rebound in yields and production in Brazil will push South American soybean production to a record 108 million tons, accounting for just below half of 2005-06 global production.

The Brazilian soybean crop for 2005-06 is projected at a record 62 million tons, up 17 percent from the drought-reduced 2004-05 crop.

Cotton

USDA did not change its forecast for 2005-06 U.S. cotton production from last month's 19.5 million bales. U.S. exports were raised 500,000 bales to a record 15 million bales, accounting for a slightly higher share of world trade relative to last month. Ending stocks are now projected at 6.2 million bales, or 30 percent of total use.

World production is projected at 106.2 million bales. World ending stocks are projected lower by just over a million bales to 44.1 million bales, due to reduced estimates of beginning stocks and production.

However, U.S. exports for 2004-05 were reduced 400,000 bales to 13 million bales based on slower-than-expected shipments to date, including a 1.5-million-bale reduction in estimated imports by China. Lower imports by China and Thailand in 2004-05 were partially offset by increases for India, Indonesia, Mexico, and Turkey.

U.S. domestic mill use was reduced 268,000 bales to 6.2 million bales in 2003-04.