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Ukraine's oilseed processing infrastructure has suffered severe damage following a series of Russian missile strikes. In December, storage tanks at the Olseeds port terminal in the Pivdenny region and the Kernel oil refinery at the port of Chornomorsk were destroyed. On 5 January, Russian forces struck the Bunge oil refinery in Dnipro, known for producing Oleina oil, followed by another attack on 7 January targeting facilities in Pivdenny and Chornomorsk.
Despite market expectations of a sharp price rise following the loss of this production capacity, sunflower oil prices actually edged slightly lower in the first ten days of January, according to data from the Ministry of Finance. Ukrainian outlet LIGA.net attributes this unusual market reaction to several factors, chief among them the near-total halt of exports via sea ports.
While tanker trucks remain available as an alternative means of transport, their capacity and cost-effectiveness are far inferior to shipping by sea. As a result, only 1,350 tonnes of oil were exported by road in the first ten days of January 2026, compared with the 12,000 to 15,000 tonnes a single medium-sized vessel can carry.
The destruction of the ports has also cut into foreign currency earnings. Stepan Kapshuk, Director General of the Ukroliyaprom association, notes that edible oils and meal account for up to 15% of the country's total foreign currency trade revenue. This situation adds further risk to the exchange rate of the hryvnia, the domestic currency, as the trade balance deteriorates.
The consequences are also being felt in the agricultural sector. A drop in oil sales could lead processors to cut back on purchases of sunflower seed, rapeseed and soybeans. In that case, Ukrainian farmers would need to look for alternatives ahead of the spring sowing season, casting doubt over harvest plans and the profitability of the industry as a whole.
Source: LIGA.net