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Ukrainian processing facilities have largely ceased purchasing sunflower seeds, a move attributed to significant market shifts and persistent export challenges. Key factors contributing to this halt include the ongoing blocking of maritime shipments and a notable pivot by many plants towards processing rapeseed instead.
This market dynamic has severely impacted sunflower producers, who are now grappling with diminished demand for their crops. Companies across the sector are compelled to re-evaluate and adjust their operational strategies in response to severe logistical constraints and a restructured processing landscape.
A decline in rapeseed prices, which have fallen to 20,000-21,000 UAH/metric ton due to export difficulties, has paradoxically enhanced the profitability of rapeseed processing. Consequently, processors are actively focusing on this crop. Only smaller oil extraction plants (OEPs), lacking the technical flexibility to reconfigure their machinery, continue to process sunflower seeds, primarily catering to the domestic market.
In southern Ukraine, all oil extraction plants have entirely suspended both sunflower and rapeseed processing. This cessation is a direct consequence of ongoing shelling, damage to infrastructure, and the complete suspension of maritime exports for both meal and oil. Currently, only a select few domestic enterprises are processing rapeseed, a trend that analysts suggest may persist through November and December, supported by substantial raw material inventories.
Purchase prices for sunflower seeds in Ukraine have seen a sharp decline, falling by 4,000-5,000 UAH/metric ton to a range of 27,000-29,000 UAH/metric ton for seeds with 50% oil content, delivered to the processing plant. Adding further pressure to the market, processors have begun to announce indicative prices for the upcoming sunflower crop at 20,000-22,000 UAH/metric ton, delivered.
Regarding international trade, export demand prices for sunflower oil remain stable at $1,320-1,335/metric ton, delivered to Danube ports. Simultaneously, demand prices for sunflower oil in India and for Russian sunflower oil designated for August delivery have observed an increase, reaching $1,370/metric ton FOB.
Analysts report that favorable weather conditions are currently improving the harvest potential for sunflower crops across Ukraine. Despite this promising outlook for supply, the market anticipates a decline in prices for the new harvest, primarily driven by the expected increase in supply and broader downward trends in oil prices.
The Ukrainian Electronic Grain Exchange reported these developments. Separately, it was noted that sunflower prices are generally rising in Ukraine, even as sunflower oil becomes cheaper.
Source: UA.NEWS