W13: Weekly Sunflower Oil Update
Europe
What’s Next for the EU’s Sunflower Oil?
The EU-27 is prepared to import record amounts of rapeseed and sunflower seeds (SFS) in the marketing year 2022/23, having already received corresponding shipments of 6.19MMT and 1.9MMT, with Ukraine and Australia serving as the main providers.
EU Expects Record Harvest of Oilseeds
2023's soybean crop is expected to set new records, according to the European Union. Specifically, more sunflower and soybean seeds are being planted, but canola acres are also growing. This year, 4.8M hectares of sunflowers are anticipated to be grown, a 10% rise. The interim exemption for the required set-aside, according to the European Commission, is what caused this rise. Additionally, in some regions that are prone to drought, more space will be devoted to sunflowers at the cost of grain corn.
Ukraine
Sunflower Lost 10% Of Its Price in March
Ukraine has noticed a decline in oil refineries' demand rates for sunflower seeds since the middle of March. The decline in sunflower oil export rates was a major factor in the growth of this tendency. Additionally, the number of oil refining companies that buy seeds from this product has slightly decreased. As a result, over the time span indicated, demand prices for oilseeds declined by USD 57.12–73.44/MT or by 12–16%, and as of March 29, they were primarily recorded in the USD 340.00–421.60/MT range.
Sunflower Prices in Ukraine Are Recovering After Falling to the Lowest Level of the Season
As a result of manufacturers' difficulties selling and shipping goods through Black Sea harbors, demand for sunflowers dropped drastically in Ukraine in March. With distribution to Romania and Bulgaria, export demand prices in W12 dropped by USD 70–100/MT from USD 510–530/t to USD 420–435/MT, and domestic purchase prices then fell by 10-15% to the lowest in-season level of USD 340–425/MT. The sudden decrease in quotes for sunflower oil, which dropped from USD 1000–1050/MT to USD 850–870/MT with transport to Bulgaria, was the cause of the price decline.
In 2023, the Sown Areas Under Sunflower, Soy and Rapeseed Will Grow by 10-15% In Ukraine
In Ukraine, it is anticipated that 2023 will see a rise in the area sown for oil products and a partial decline for grains and maize. The planted areas for sunflower, soy and rape will be increased by 10-15%. However, due to unfavourable weather conditions, less winter wheat is sown in the fall, resulting in a decline in cereal crop output. Costly procedures have caused a 10-12% decrease in maize planting regions.
Sunflower Seed Prices in Ukraine Have Fallen by 12-16% Since the Beginning of March
Since the middle of March, a decline in sunflower seed demand from oil plants has been observed in Ukraine. The decline in sunflower oil export rates was a major factor in the growth of this tendency. Additionally, the activity of buying seedlings for this product has been somewhat decreased by oil refining companies. As a result, during the time span in question, oil demand rates decreased by UAH USD 57.12–73.44/MT, or by 12–16%.
Areas Under Sunflowers in Ukraine’s Mykolaiv Region Will Be Tripled
Due to a decline in grain crops, the area covered by sunflowers in the Mykolaiv region will be three times larger in 2023. There are also some barley, rapeseed, and wheat under winter crops, covering about two-thirds of the land. Sunflower is one of the most lucrative crops currently grown, so the leftover areas are intended to be allocated to it. Although the selling prices of wheat, rape, and sunflower are different and the logistics costs are comparable, more sunflower has been sown in this region this year in order to remain afloat.
In Ukraine, Black Sea Sunflower Oil Prices Drop By 15% Over Past Two Months
The price of sunflower oil in the Black Sea area has dropped 15% in the last two months, reaching its lowest point in 2.5 years. Prices for sunflower oil in the area in W13 had dropped below the USD 1,000/MT mark to USD 990/MT CIF Turkey and USD 980/MT CIF Varna, arriving in April. Prices have decreased across all distribution bases. At one time, European buyers were unable to compete on price with Turkish buyers because the latter's prices were, on average, 4.5% higher.
Russia
On March 31, the Federal Antimonopoly Service, the Ministry of Agriculture, the Ministry of Economic Development, the Ministry of Industry and Trade, the Ministry of Finance, and the Ministry of Industry and Trade were all given instructions by Russia's Deputy Prime Minister Victoria Abramchenko to examine the possibility of eliminating the export tax on sunflower seeds. From July 1, 2021, to August 31, 2022, the export duty on sunflowers was set at 50%, but it could not be less than USD 320/MT. After that, it was prolonged until August 31, 2023.
Sunflower Prices in Russia Fell to a Multi-Month Low
By March 22, the market price for sunflower seeds had decreased to USD 300.38/MT. Since November 2022, this number has been at its lowest. Prior to the price decrease, there was a decline in processor demand for the produce and a seasonal deterioration in storage conditions. The primary cause of the decline in sunflower processor demand was the drop in sunflower oil export prices.
Russia’s Penza Region Supplies Sunflower Oil to China Again
Since the implementation of pandemic limitations, the first container train carrying sunflower oil departed from Penza-II station for Harbin, China. 82 containers each contained 1,800MT of oil generated at the Penzensky oil facility were transported to the Celestial Empire.
From April 1, the Export Duty on Sunflower Oil From Russia Will Decrease by USD 8.53
The duty on the sale of sunflower oil from Russia will drop from USD 26.36/MT to USD 17.83/MT as of April 1, 2023. On the other hand, the amount of the export tax on meal will go up from USD 42.79/MT to USD 60.90/MT.
There is nowhere to keep sunflowers in Russia. Because of massive inventories and manufacturers' decreased demand for raw materials, the price of raw materials has decreased by a third over the last three weeks, from USD 254.29-381.44/MT. Large supplies to factories, including those from the annexed regions, caused the collapse.
Bulgaria
Bulgaria Becomes Top EU Importer of Ukrainian Sunflower Seeds
According to a study by the United States Department of Agriculture, Bulgaria has risen to the top position among European Union (EU) importers of sunflowerseeds from Ukraine, accounting for 40% of all EU imports and increasing crushing in the 2022/23 marketing year. The total oilseed output in Bulgaria grew by 8% over the period, but due to lower yields brought on by heat and drought, it stayed at the same level as the previous year at 2.4MMT.
Turkiye
Sunflower Planting Shift Started in Edirne, Turkiye in W13
After the rains that had been effective in the past days in Edirne, the farmers, who completed their preparations with the arrival of the soil pan, started to bring the sunflower seeds together with the soil. In Edirne, one of Turkey's leading sunflower production centers, the rains that have been effective in the past days have given life to the soil and hope to the farmers. Producers, who were worried about the insufficient winter precipitation, started preparations after the rain before the sunflower planting.
Kazakhstan
Sunflower Oil Production Increased in Kazakhstan
Unrefined sunflower oil production has increased by 113%, reaching 229,379MT in the first six months of the 2022/23 growing season. While this number was somewhere around 107,579MT during the same time period in the previous season. The production of refined sunflower oil has also increased significantly this season. Domestic oil factories produced 85,375MT of this product between September 2022 and February 2023, which is 22% more than during the same time last year, when 69,968MT of refined oil was produced.
Romania
Drought Cuts Romanian Grain and Sunflower Seed Output in 2022, According to the Stats Office
Due to adverse weather conditions and increasing production expenses, Romania's production of wheat, maize, and sunflower seeds decreased by double digits in 2022. Sunflower seed production was 2.08MMT, down 27%, and maize harvest was 8.2MMT, down 44.7%.
Spain
The AEG Emphasizes That Sunflower Oil Continues to Be the Most Competitive in the Spanish Market
The Spanish Sunflower Association (AEG) makes sure that conventional and high oleic sunflower oil remain the most competitive oils on the Spanish market and that it has become a mainstay in shoppers' shopping baskets as a result of the increase in food prices. Given that a consistent and adequate supply of this product is anticipated, the average price of sunflower oil has decreased for both conventional refining (-1.28%) and high oleic (-1.26%). Sunflower oil ranks fourth among the most consumed oils and fats globally, after palm, soybean, and rapeseed, despite the fact that these oils are not typically used in cooking. As a result, sunflower oil is the most popular seed oil in Spain, with a market share of close to 30%.
