W13 Sunflower Update: Argentina's 2023/24 Sunflower Crop Projections Drop Amidst Crop Condition Concerns, Sunflower Prices Surged in Ukraine

Published 2024년 4월 6일

In W13 in the sunflower oil landscape, the oilseed processing volume in the EU and the UK experienced a 6.1% MoM decrease in Feb-24, totaling 3.285 mmt. Expectations for the 2024/25 season suggest a 2% YoY rise in EU oilseed processing, driven primarily by increases in sunflower and soybean processing volumes. Meanwhile, Ukraine's sunflower purchase prices surged due to hikes in sunflower oil prices and the dollar exchange rate. In Kazakhstan, efforts are underway to expand sunflower cultivation despite irrigation challenges. However, sunflower crop projections in Argentina have been revised downwards due to excessive rainfall, with concerns rising about crop conditions and a reduction in output projections.

EU and UK Oilseed Processing Decreased 6.1% MoM in Feb-24

According to data from the European Union (EU) vegetable oil and protein meal industry organization, oilseed processing volume in the EU and the United Kingdom (UK) decreased 6.1% month-on-month (MoM) in Feb-24, however it increased 6.6% year-on-year (YoY). The crushing volume of the three main oilseeds (soybeans, sunflower seeds, and rapeseed) in Feb-24 totaled 3.285 million metric tons (mmt), down from 3.5 mmt in Jan-24 but higher than the 3.081 mmt recorded in Feb-23. For the first two months of 2024, the oilseed crush volume reached 6.785 mmt, reflecting a 6.8% increase YoY. In 2023, the total oilseed crushing volume in the EU and UK amounted to 38.043 mmt, marking a 3.2% YoY increase from 2022's 36.855 mmt.

EU Oilseed Processing Forecasted to Rise in 2024/25 Season

EU oilseed processing is expected to rise 2% YoY in the 2024/25 season, reaching 48.4 mmt. This growth will be primarily fueled by sunflower and soybeans, with processing volumes projected to increase by 4.5% and 2.8% YoY, totaling 9.8 mmt and 14.5 mmt, respectively. The anticipated increase is due to expectations of improved crop yields, particularly a 5% YoY increase for sunflowers due to favorable weather conditions. Maintaining imports at current levels is also expected to contribute to the overall increase. While exact harvest quantities for sunflowers are unspecified, recent estimates suggest sunflower production could reach 10.7 mmt, potentially exceeding initial projections.

Ukraine's Sunflower Purchase Prices Surged in W12 Amid Dollar Exchange Rate Fluctuations

Sunflower purchase prices in Ukraine saw a significant increase in W12, rising by USD 10.19 and 15.29 per metric ton (mt) to USD 382.24 to 394.98/mt (including VAT) with delivery to the plant. This surge was due to a 4% hike in sunflower oil prices and a nearly 2% increase in the dollar exchange rate over the last two weeks. Despite initial higher prices for quick delivery, many processors eventually lowered prices following a drop in the interbank dollar rate. Demand prices for sunflower oil with buyer delivery also rose, reaching USD 855/mt, while spot prices in Black Sea ports remained stable at USD 770 to 785/mt. Sunflower oil exports from Ukraine for March 14 to 20 saw a notable increase of 67% week-on-week (WoW), totaling 178 thousand mt. However, overall exports for the 2023/24 season remain below forecast at 3.6 mmt out of an anticipated 6 mmt.

Expansion of Sunflower Cultivation in Kazakhstan Amidst Agricultural Growth Plans

The forecasted sown area for crops in Kazakhstan in 2024 is 23.8 million hectares (ha). The Ministry of Agriculture aims to expand the cultivation of highly profitable crops, notably sunflower, by 60 thousand ha to 1.2 million ha. Despite challenges related to irrigation water provision, such as supply issues, the government remains focused on enhancing the diversification and profitability of crop cultivation in the country.

Argentina's 2023/24 Sunflower Crop Projections Dropped Amid Rainfall Concerns

Argentina's 2023/24 sunflower crop projections have been revised downwards due to abundant rainfall in the central and southern regions, as reported by the Buenos Aires Grains Exchange (BAGE) weekly report. Despite significant progress in sunflower harvest, reaching 59.2% completion for the 2023/24 season, particularly in the southern regions before the rains, concerns have arisen regarding crop conditions. Sunflower crops rated as good-to-excellent decreased by 25% of the total planted area, while areas considered poor increased to 29%. Additionally, areas classified as dry decreased to 17%, while those with excessive moisture rose to 28%. BAGE has adjusted its sunflower output projection to 3.6 mmt, reflecting a reduction of 200 thousand mt from the previous estimate and 1 mmt from the 2022/23 harvest.