USDA Raises Sunflower Production Forecast, But Sharply Lowers FY2023/24 Export Estimate
According to the USDA's May forecast, in 2023/24 the global production of oilseeds will grow by 7% compared to the current season due to an increase in the production of soybeans in South America and sunflowers in the EU, Ukraine and the Russian Federation. At the same time, world oil consumption will increase by only 4%, which will lead to an increase in final stocks.
USDA experts increased the forecast of world sunflower production in 2022/23 MR by 1.2 million tons to 51.64 million tons, in particular for Ukraine – by 0.8 to 11.2 million tons and Argentina – by 0.4 to 4.2 million tons. At the same time, they reduced the forecast of sunflower imports to the EU by 0.4 to 2.3 million tons. For the second month in a row, they did not significantly lower the export estimate for Ukraine, and in May the export forecast was reduced by only 0.1 to 2.55 million tons , although against the background of the ban on the supply of domestic sunflower to 5 EU countries, exports decreased from 200,000 tons in March to 40,000 tons in April, and in 2022/23 MR totaled 1.9 million tons.
It is expected that in 2023/24 the world sunflower production will increase compared to the current season from 51.6 to 54.3 million tons, in particular in Ukraine - from 11.2 to 11.8 million tons, in the EU - from 9.3 to 11.5 million tons, the Russian Federation - from 16.2 to 16.5 million tons, Kazakhstan - from 1.3 to 1.4 million tons, while in Argentina it will decrease from 4.2 to 3.9 million tons.
At the same time, according to the USDA forecast, sunflower exports in the new season will decrease compared to the current one from 5.3 to 3.6 million tons, in particular from Ukraine - from 2.55 to 0.7 million tons, and final stocks will decrease from 4.4 to 3 .7 million tons, which will be twice as much as the 2021/22 MR indicator - 8 million tons. In Ukraine, reserves will decrease from 1.37 to 0.48 million tons, the Russian Federation - from 1 to 0.9 million, Argentina - from 0.9 to 0 .8 million tons against the background of increased processing.
Currently, the sunflower market in Ukraine has reached a stalemate: refiners have stopped production because they cannot ship oil through Black Sea ports, and the EU market is overstocked, due to which sunflower oil prices have fallen to $750-780/t FCA plant. At the same time, against the backdrop of plant shutdowns and supply shortages, as well as a seasonal increase in demand from feed manufacturers, prices for meal and cake rose to UAH 9,000/t. Purchase prices for sunflowers have dropped to UAH 14,000-15,000/ton with delivery to the factory, and only the resumption of exports from Black Sea ports will be able to support them.
