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The Ukrainian oilseed industry is facing a strategic challenge as military attacks intensify against industrial facilities, specifically targeting oilseed processing plants. These actions appear aimed at destabilising a sector critical for Ukraine's foreign exchange earnings, potentially weakening the position of Ukrainian exporters in the global vegetable oil market.
While previous strikes focused on port infrastructure in southern Ukraine, recent attacks over the past week have expanded to facilities in the Poltava, Vinnytsia, Chernihiv, Chernivtsi, and Khmelnytsky regions. These incidents have forced operations to cease as enterprises assess structural damage and plan restoration timelines. Tragically, casualties among facility staff have also been reported. The resulting reduction in active processing capacity is driving down domestic purchase prices for sunflower seeds, which currently sit between 15,000 and 16,000 UAH/t including VAT ($290–310/t excluding VAT) for delivery to factories with 48% oil content.
Agricultural data as of November 10 reveals that 10.711 million tons of sunflower have been harvested from 91.6% of the planned area, with an average yield of 2.23 tons per hectare. However, prolonged rainfall throughout October has left a portion of the crop in the fields, raising risks of yield loss or qualitative degradation. Compounding these domestic issues is a shift in global demand; falling crude oil prices have triggered a sharp decline in palm oil costs, prompting major buyers like India to increase palm oil imports while reducing their appetite for sunflower oil.
Logistical and regulatory hurdles are further complicating the export landscape. Demand prices for delivery to Turkey remain at $580–600/t, but the exhaustion of the 50,000-ton duty-free quota means future deliveries will likely incur a 10% export duty. Additionally, road freight costs to Turkey have surged to $160–180/t. In the Bulgarian market, export demand prices range from $535 to $545/t, yet rising delivery costs and the complexities of obtaining export licenses continue to erode margins. With domestic demand weakening, active exportation remains the primary but increasingly difficult route for achieving favorable prices.
Source: Electronic Grain Exchange of Ukraine