W35: Sunflower Update

In W35 in the sunflower oil landscape, global sunflower production for the 2023/24 marketing year is projected to increase by 1.4 million metric tons (mmt) to 55.7 mmt. This is primarily driven by robust production in Russia (15.7 mmt) and Ukraine (14 mmt), which will compensate for declining sunflower crops in Turkey (1.55 mmt), Romania (2.5 mmt), Bulgaria (3.72 mmt) and Argentina (3.72 mmt). Favorable weather conditions in Russia and Ukraine have contributed to high sunflower yields, while drought has significantly affected crop conditions in Romania and Turkey. In Turkey's Thrace region, which accounts for about 65% of the country's sunflower production, farmers have reported yield losses of 30 to 50% due to the driest season in the past 30 years.

Meanwhile, the Argentinian sunflower planting season faces delays due to insufficient rainfall. As of August 23, only 80 thousand hectares (ha) were sown, significantly lower than the 227 thousand ha sown during the corresponding period in 2022. Additionally, the total sunflower planting area for the new season in the country might decrease by 150 thousand ha due to these delays and water shortages.

In Russia's Krasnodar region, sunflower harvesting has commenced in W35. This region primarily exports its sunflower production to various parts of Russia and friendly countries. Annually, the region yields approximately 600 thousand metric tons (mt) of sunflower oil, with a domestic demand of about 100 thousand mt. The key sunflower cultivation areas are in Novopokrovsky, Kushchyovsky, Kanevskoy, Krylovsky, and Yeysk districts.

In Bulgaria, farmers have reported Romanian traders bringing sunflowers from Ukraine and then transiting them to Bulgaria, labeling them as Romanian. This strategy allows the sunflowers to enter Bulgaria without violating the imposed restrictions on oilseed imports, which are effective until September 15 and are expected to be extended until the end of the year. The sunflowers in question are from last year's harvest, despite Ukraine starting its sunflower harvest this week.

From Jan-23 to Jul-23, Kazakhstan saw a 22% year-on-year (YoY) increase in unrefined sunflower oil production, totaling 225.33 thousand mt. Conversely, refined sunflower oil production decreased to 67.92 thousand mt, down from 83.72 thousand mt during the same period in 2022. Furthermore, in Jul-23, Kazakh enterprises produced 32.34 thousand mt of unrefined sunflower oil, slightly lower than the Jun-23 figure of 34.34 thousand mt but higher than the 23.96 thousand mt produced in Jul-22. Meanwhile, refined sunflower oil production amounted to 8.21 thousand mt versus 11.86 thousand mt in Jun-23 and 8.73 thousand mt in Jul-22.

Lastly, Turkey's sunflower oil stocks at the beginning of Aug-23 had doubled compared to the same period in 2022, reaching 500 thousand mt. This increase is attributed to active sunflower oil imports between Sept-22 and Jul-23, with a record import volume of 1.27 mmt, primarily sourced from Ukraine.