W52 Sunflower Update: Russia and Ukraine's Supply Surges, and Russia Expects a Record-Breaking Harvest in 2023/24 MY

Russia and Ukraine's Sunflower Oil Supply Surge Impacted Global Palm Oil Prices

The global market is experiencing increased pressure on palm oil prices due to rising supplies of sunflower oil from Ukraine and Russia, as well as soybean oil from Brazil and Argentina. In Nov-23, Ukraine's sunflower oil exports grew by 32% month-on-month (MoM), reaching 538 thousand metric tons (mt). However, demand prices for Ukrainian sunflower oil in Dec-23 decreased by USD 30 to 40/mt to USD 720 to 730/mt DAP (Danube ports) and USD 710 to 730/mt DAP (Black Sea ports). This drop is attributed to increased supplies and declining prices in China and Turkey.

Russia's 2023/24 sunflower harvest aims for a record 17.5 MMT

Russia's preliminary sunflower harvest for the 2023/24 marketing year (MY) is poised to set a new record at 16.7 million metric tons (mmt). However, final projections suggest it will reach 17.5 MMT, surpassing last year's 16.55 mmt. Similar weather challenges as the previous year are expected to hinder cleanup efforts for 2023, affecting sunflower and soybean hectares. Moreover, the newly annexed regions of the Russian Federation are forecasted to exceed last year's sunflower harvest, possibly reaching 1.5 mmt.

Ukraine Sunflower Prices Continued Rising in W52

Purchase prices for sunflowers in Ukraine have risen, returning to the levels at the beginning of Dec-23. Analysts report that on the domestic market, processor prices for crops have reached USD 355.06 to 368.21/mt. Meanwhile, demand prices in Ukraine's western and southern regions are even higher at USD 381.36/mt.

Ukraine Completes 99% of Sunseed Harvest by December 21, 2023

As of December 21, 2023, Ukraine completed 99% of its sunseed crop harvest, yielding 11.97 mmt of grain with an average yield of 2.39 mt/ha, according to the Ministry of Agrarian Policy. Kirovograd region saw the majority of sunflower seed planting this season, covering 631 thousand ha, marking a 4.4% year-on-year (YoY) increase. Furthermore, the top five regions in Ukraine with the highest average sunflower yield are Ternopil (3.35 mt/ha), Khmelnytsky (3.3 mt/ha), Ivano-Frankivsk (3.2 mt/ha), Chernivtsi (3.08 mt/ha), and Cherkasy (2.87 mt/ha).

Kazakhstan's Jan-Oct 2023 Sunflower Oil Production Up 3.2% YoY

Kazakhstan experienced a 10.2% YoY increase in vegetable oil production from Jan-23 to Oct-23, reaching 549.6 thousand mt. Sunflower oil production specifically increased by 3.2% YoY during this period. Meanwhile, sunflower oil export recorded a 1.5 times increase in foreign shipments, totaling 293.6 thousand mt valued at USD 264.7 million. Conversely, sunflower oil imports decreased by 17.6% YoY to 78.4 thousand mt, valued at USD 76.9 million. Russia was the main source of imports, supplemented by smaller volumes from China, Poland, and Tajikistan.

Moldova Extended Sunflower Seed Import Licensing until Mar-24

The Emergency Situations Commission of the Republic of Moldova has extended the import licensing regime for certain grain products and oilseeds, such as wheat, corn, and sunflower seeds, until Mar-24. Import licenses will be mandatory during this period, and the application review process involves representatives from various government bodies and professional organizations, according to the Ministry of Agriculture and Food Industry of Moldova. This measure is to stabilize grain prices and safeguard local producers.