The 2023–24 Sunflower Supply Is Projected To Be Positive

Published 2023년 8월 14일

The United States Department of Agriculture (USDA) has projected that the global sunflower seed output for 2023-24 will be around 54.7 million metric tons (mmt), up 2 mmt from the previous marketing year's production. This is due to increases in Ukraine, a top oilseed sunflower producer, upward revisions of the Argentine crop, and positive prospects in the European Union (EU). The increase in production in major producing regions will lead to a comfortable sunflower fundamental picture towards the end of this season and the 2023-24 season, with crushing activity likely to be higher, reaching a new high of 50.4 mmt.

The United States Department of Agriculture (USDA), in its latest Oil Crops Outlook report, has projected that the global sunflower seed output for 2023-24 will be around 54.7 mmt, up 2 million metric tons (mmt) from the previous marketing year's production. The projected increase in output is due to increases in Ukraine, a top oilseed sunflower producer, upward revisions of the Argentine crop, and prospects in the European Union (EU).

Although the US crop is expected to fall slightly due to a lower planted area, a higher expected crop in other countries is enough to keep the new global crop output up. Due to farmers planting oilseeds rather than grains, Ukrainian production is going to see its production rise year-on-year. The USDA's estimated harvested area of the Ukrainian old crop is already revised up to 6 mmt. This should create enough supplies to feed into higher beginning stocks for next year.

Having overtaken its neighbor Ukraine as the world's top oilseed sunflower-producing country only this year, Russia is also on course to have increased production in the new crop year. On the back of that, its sunflower oil production is also expected to go up 1% to 6.36 million mt in 2023-24.

Another oilseed sunflower-producing country whose output is forecasted up is Argentina: the Argy crop is projected to be slightly up from the 4.3 mmt in the 2022-23 marketing year since the yield is expected to be higher. The crop will expand by 0.6 mmt to 4.9 mmt. The 4.9 mmt is an upward revision by the USDA from 4.3 mmt a month ago which should support a higher global sunflower output.

The EU sunflower supply is also revised upward this month due to an ascendant adjustment in Bulgaria. The EU 2023-24 sunflower crop is estimated to be 10.61 mmt, up from the 9.16 million mt in the 2022-23 season. The marginal revision in the EU oilseed sunflower crop is one of the key reasons for the changes in the EU oilseed fundamental picture.

Given the production increases in major producing regions, the global sunflower fundamental picture towards the end of this season and the 2023-24 season is undoubtedly primed to be comfortable. Crushing activity will likely be higher, reaching a new high of 50.4 mmt. Sunflower oil would also rise, likewise meal and other derivative products. That laxity in the seed market should translate to its oil and meal counterparts.

Exports traversing from this year to next are projected to be flat, and with production increasing, ending stocks should hit nearly 3 mmt higher than the season before, consequently making the general sunflower market lax. This picture would set up a very bearish trend well into the first quarter of next year. Old crop prices should also move from lower to steady beginning in the last quarter of 2023.