W3 Sunflower Update: Russia Sees 38% YoY Drop in Sunflower Seed Imports in 2023, Shifts Focus on Friendly Partners

USDA Lowered Global Sunflower Oil Outlook for 2023/24 MY

The United States Department of Agriculture (USDA) lowered its global oilseed production forecast for the 2023/24 marketing year (MY) to 660 million metric tons (mmt) from the Dec-23 estimate of 661 mmt. The revision is due to a significant reduction in soybean yields in Brazil and sunflowers in Argentina, the European Union (EU), and Russia. The forecast for global sunflower seed production was lowered to 55.5 mmt from the previous estimate of 56.8 mmt. Russia's sunflower seed harvest forecast decreased to 17.1 mmt, and the EU's to 10.2 mmt. While sunflower seed exports from Russia are projected to be 450 thousand metric tons (mt), down from 550 thousand mt in Dec-23, the forecast for Russian exports of sunflower oil increased to 4.3 mmt from 4.275 mmt. Sunflower oil production in Russia is now estimated at 6.815 mmt.

Russia Sees 38% YoY Drop in Sunflower Seed Imports in 2023

Russia witnessed a 38% year-on-year (YoY) reduction in sunflower seed imports to 15.1 thousand mt in 2023. There is a reported shift in the import landscape, with a decrease in the share of sunflower seeds and corn from unfriendly countries by 22% in 2023. Notably, the United States (US) and Austria exited the Russian market, and EU countries, including top suppliers Hungary and France, significantly decreased supplies. Russia reoriented imports towards friendly partners, with Turkey notably increasing supplies by 15% for sunflower seeds and doubling corn seed shipments to Russia. The total demand for sunflower seed material in the Russian market is estimated at 40 thousand mt, including 8 thousand mt of domestically selected varietal sunflower.

Bulgaria Anticipates Sunflower Acreage Rebound in 2024

The sunflower sowing area in Bulgaria in 2023 was 6% YoY less due to the drop in prices under the pressure of large sunflower stocks caused by high imports from Ukraine. This decrease was also influenced by an 18% YoY lower yield, resulting in a 23% YoY reduction in the gross harvest. However, the increasing needs of Bulgaria's processing industry and a decrease in sunflower imports are expected to stimulate farmers to restore sunflower acreage in 2024. In the Jan-24 balance sheet, a rise in sunflower imports by 100 thousand mt is anticipated compared to the previous forecast due to lifted restrictions on imports from Ukraine and the implementation of the export licensing mechanism from Ukraine.

Kazakhstan's Sunflower Seed Exports Thrives in 2023/24 MY, Despite Export Duty

Agricultural producers in Kazakhstan are actively exporting sunflower seeds despite a significant export duty on them. Since the start of the 2023/24 MY, around 20 thousand mt of sunflower seeds and kernels have been exported monthly, maintaining the average annual export level. Nov-23 recorded the highest volume at 26 thousand mt. Effective from Feb-23, the duty is 20% of the crop's cost, but not less than USD 108.63/mt. The National Association of Oilseed and Vegetable Oil Manufacturers (NAPMK) expresses concern over false information potentially causing conflicts between sunflower producers and processors.

Manitoba's 2023 Sunflower Yields Soared, But Profitability Dipped in 2024

In 2023, sunflower yields in the Canadian province of Manitoba reached 3.5 thousand pounds (lb) per acre, significantly surpassing the historical average of 2 to 2.5 thousand lb/acre. Despite the high yields, Manitoba Agriculture has rated sunflower as the least profitable crop for 2024. With a yield of 2.24 mt per hectare, sunflower for oil is expected to incur a "negative profit," resulting in a loss of USD 119.34/acre and a profitability rate of minus 24%.