W4 Sunflower Update: USDA Revises 2023/24 Global Sunflower Seed Production to 55.54 MMT, Citing Reduced Estimates in EU and Argentina

Global Sunflower Seed Production Expected to Drop to 55.54 MMT in 2023/24 Season

In its Jan-23 report, the United States Department of Agriculture (USDA) reduced the global sunflower seed production estimate for the 2023/24 season from 56.80 million metric tons (mmt) to 55.54 mmt. This reduction is due to lower European Union (EU) and Argentina production estimates. Despite the decrease, the expected production level remains 3.15 mmt higher than the previous season. This did not significantly impact the sunflower complex's price situation in Europe. Analysts in Europe attribute the sustained pressure on sunflower oil prices to increased supplies from Ukraine and Russia and lower soybean oil prices, influenced by the heightened soybean harvest forecasts in Argentina.

Ukraine's 2023/24 Vegetable Oil Exports to Surge with Sunflower Boost

According to the Jan-24 report from the USDA, there is an upward adjustment in the forecast for vegetable oil exports from Ukraine in the 2023/24 marketing year (MY). Analysts now anticipate Ukraine to export 6.4 mmt of vegetable oils in the current season, which is 100 thousand metric tons (mt) more than the Dec-23 forecast. The surge in oil exports is due to increased sunflower supply, with foreign market supplies projected to reach 5.7 mmt, an increase of 100 thousand mt. Furthermore, experts have revised the estimates for sunflower oil production to 6.07 mmt, an increase of 45 thousand mt. These adjustments reflect the dynamic nature of agricultural forecasts and production expectations in Ukraine for the specified period.

EU Sunflower Seed Processing Increased 13% MoM in Dec-23

The total processing volume of rapeseed, soybeans, and sunflower seeds in the EU in Dec-23 saw a 9% year-on-year (YoY) increase, reaching 3.9 mmt, surpassing the Dec-22 volume of 3.3 mmt. Sunflower seed processing reached 0.68 mmt, reflecting a 13% month-on-month (MoM) increase and a substantial 36% YoY increase. In2023, oilseed processing in EU countries amounted to 38.9 mmt, marking an increase from 36.9 mmt in the previous year. Sunflower seed processing contributed to this overall growth, reaching 6.2 mmt in 2023 compared to 5.1 mmt in 2022.

Türkiye's Sunflower Imports Reduced 2.4 Times in First Three Months of 2023/24 MY

Having faced drought in 2023, Türkiye has taken proactive measures at the beginning of the 2023/24 MY by significantly reducing sunflower imports. Official statistics reveal a 2.4 times reduction in oilseed purchases over the first three months of the 2023/24 MY, dropping from 146.8 thousand mt to 60.8 thousand mt. The monthly breakdown of sunflower imports was 32.9 thousand mt in Sept-23, 14 thousand mt in Oct-23, and 13.9 thousand mt in Nov-23.

Türkiye Lowered Sunflower Import Duties and Sets Quotas Until April 15, 2024

The Turkish government has opted to decrease import duties on sunflower seeds from 27% to 12% and sunflower oil from 36% to 22% until April 15, 2024. Simultaneously, quotas have been instituted for the import of these products. The set quotas are 100 thousand mt for sunflower and 250 thousand mt for sunflower oil.

Russia Extends Zero Export Duty on Sunflower Oil in Feb-24

Russia continues with a zero export duty on sunflower oil in Feb-24, a policy originating from a reset in Jun-23. Indicative prices determine the duty calculations. Moreover, the Russian government has extended the export duties on sunflower oil and meal until August 31, 2024.