Sunflower prices in Ukraine are increasing against the backdrop of increased export of seeds and processed products

The invigoration of ships entering the Black Sea ports and the pace of sunflower exports are forcing processors to step up purchases and raise prices, given the shortage of offers from farmers.

The Joint Coordination Center reports that as of November 22, 76 ships are waiting for permission to enter the ports of Ukraine through the grain corridor (although at the beginning of the month there were 175), and another 33 loaded ships are being prepared for inspection in Turkish territorial waters before departure to their destinations.

According to the Ministry of Agriculture, during the week, Ukraine increased the export of sunflower oil by 9% to 175.5 thousand tons, but decreased the export of seeds by 6.5% to 94.8 thousand tons and sunflower meal - by 67.5% to 46.99 thousand tons. t due to lack of supplies from manufacturers. In total, 1.36 million tons of sunflower oil and 770.7 thousand tons of seeds were exported in 2022/23 MR. Most factories are unable to process sunflower due to power outages, and are gradually restocking as export shipments are made.

This year, Ukraine will harvest the smallest sunflower crop in many years, but so far this has not affected purchase prices, as the main processing facilities are located near the Black Sea ports, and their work has been stopped due to constant missile attacks and uncertainty with further exports.

As of November 17, 9.8 million tons (16.3 million tons last year) of sunflower were threshed from 4.5 million hectares or 96% of the area in Ukraine with a yield of 2.17 tons/ha. Due to bad weather, harvesting is delayed and seed quality will be significantly worse than last year, and some of the crop will have an acid number above 4%, which will reduce the amount of raw material suitable for processing into edible oil.

Purchase prices for sunflower in Ukraine increased by 500-1000 UAH/t during the week to 15-16 thousand UAH/t or 410-435 $/t with delivery to the factory following the increase in export prices, but may soon fall again against the background of a decrease in export prices prices for sunflower oil and seeds.

Sunflower export prices for DAP delivery - Romania, Hungary and Bulgaria rose from $550-570 to $580-600/t last week, but fell back to $550-560/t DAP from Monday under pressure from falling oil and palm oil prices oil by 9-11%.

Demand prices for sunflower oil for delivery to Bulgaria fell to $1,220-1,230/t DAP, while those for port delivery remained at $1,000-1,050/t.

Egypt's GASC purchased 30.75 thousand tons of Russian and Bulgarian sunflower oil for January 2023 delivery and payment within 180 days after delivery at a price of $1,380/t C&F, which is 6.8% lower than the early November trading price. This indicates that there is no prospect of growth in sunflower oil prices, especially given the low prices of palm oil at the level of $875/t.

According to the Fediol Association of Vegetable Oil and Meal Industry, in October, compared to October 2021, EU countries reduced the volume of sunflower processing by 30% to 415,000 tons, and soybeans to a 9-year October minimum of 716,000 tons, while they increased the volume rapeseed processing by 4% to the highest figure since 2016 for this month – 1.6 million tons.

The active processing of rapeseed is due to high demand for biodiesel, while the demand for edible vegetable oils remains low against the background of increased supplies of bottled refined oil from Ukraine to the EU market.