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Sunflower oil prices in Ukraine are currently facing sustained downward pressure, driven primarily by escalating logistics expenses and significant delays in shipments. Despite the robust demand and elevated pricing observed on the global stage, domestic rates have struggled to keep pace. Over the past week, Ukrainian sunflower oil was valued at approximately $1,100 per tonne on an FCA plant basis, while prices for delivery to the western border reached $1,200 per tonne. This buildup of inventory at processing sites has raised alarms regarding potential temporary operational halts at several facilities.
On the international front, bidding for sunflower oil in India has remained steady within the $1,390–$1,400 per tonne CIF Mumbai range. Conversely, offers emanating from the Black Sea region are positioned higher, between $1,400 and $1,450 per tonne CIF Mumbai. In the Turkish market, although importers are prepared to engage at price points of $1,320–$1,340 per tonne, Ukrainian exporters are finding it difficult to compete with more competitively priced Russian supplies.
The soybean oil sector has trended downward recently. December futures on the Chicago Board of Trade (CBOT) saw a weekly decline of 2.8%, settling at $1,498 per tonne following updated reports suggesting a higher-than-expected US soybean yield. Spot prices in South America reflected this cooling, with Brazil maintaining $1,220–$1,240 per tonne FOB and Argentina offering $1,200–$1,220 per tonne FOB. However, the Chinese market provided a counter-trend, as soybean oil futures on the Dalian exchange climbed by $20 per tonne to reach $1,330–$1,335 per tonne.
Meanwhile, the European rapeseed oil market exhibited relative stability. Trading occurred within a tight window of $1,385–$1,390 per tonne FOB Netherlands, influenced by a combination of rising supplies and a weakening euro against the US dollar. Additionally, the broader vegetable oil market continues to find support from the rally in palm oil prices, which is prompting international buyers to re-evaluate their procurement strategies.
Looking ahead, the pressure on Ukraine's sunflower oil market is expected to intensify as the harvest picks up speed, leading to an influx of raw materials. Given the existing constraints on export infrastructure and the rising costs of rail and road freight, domestic prices are likely to remain suppressed even if global benchmarks remain firm.
Source: UkrAgroConsult