Purchase prices for sunflower in Ukraine are falling due to Russian strikes on oil extraction plants and ports

The intensification of attacks on Ukraine with missiles and drones by the Russian Federation is forcing processing plants and ports to stop work due to constant alarms or damage.

Last week, the targets of attacks were oil extraction plants in Mykolaiv and Dnipro, as well as vessels near Danube ports and port infrastructure.

Given such attacks, processors are reducing processing volumes or stopping operations altogether, without risking accumulating large volumes of oil and meal in storage facilities.

Purchase prices for sunflower decreased by another 500-1000 UAH/t over the week to 18,000-18,500 UAH/t including VAT ($360-365/t excluding VAT) with delivery to factories in the central part of Ukraine, but there have already been queues there for 3-4 days due to the increase in sunflower arrivals from the southern and eastern regions, where active harvesting has begun.

As of September 15, 526.62 thousand tons of sunflower were threshed in Ukraine from 275.4 thousand hectares or 5% of the area with an average yield of 1.91 tons/hectare, which significantly exceeds the indicator at the start of the last season.

Sunflower oil demand prices in India decreased by $10/t to $1,430/t CIF Mumbai in a week under pressure from increased supply from the Black Sea region.

In Ukraine, demand prices for sunflower oil also fell by $100/t to $1,100-1,120/t for delivery to Danube ports during the week due to increased shelling of ports and an increase in freight costs to the ports of Constanta.

A reduction in domestic processing of sunflower in Ukraine could offset an increase in its exports, but the Ministry of Economy increased the minimum price of sunflower and sunflower oil , which practically paralyzed customs clearance for exports.

At the same time, export demand prices for sunflower for delivery to Bulgaria decreased by another $10/t to $540-550/t in a week against the backdrop of increasing supply from both local farmers and Ukraine.

The inability to export sunflower this season and the threat of strikes on processing plants in Ukraine will continue to drive down sunflower prices.