Sunflower Harvest Accelerates in Ukraine, Yield Potential Decreases Due to Dry Weather

Dry and warm weather conditions in Ukraine have speed up the harvesting of sunflowers, but the heat has taken a toll on yield potential. As the harvest progresses, market dynamics are beginning to shift, especially in terms of pricing for sunflower oil and meal.

Sunflower Oil Prices Increase Slightly, But Export Drops Sharply

Over the past week, demand prices for sunflower oil with delivery to ports have increased by $10 per ton, reaching $920-930/t. Meanwhile, at the Ukraine-Poland border, prices dropped to $910-915/t. This is a notable change since August when demand prices at the western borders were higher than those at the ports.

One of the reasons for this shift is the rising supply of rapeseed oil in the European Union, which has significantly reduced the demand for Ukrainian sunflower oil, particularly from biodiesel producers who were actively importing during the summer. As a result, sunflower oil exports from Ukraine in August fell by 48% compared to July, totaling 227,000 tons—the lowest figure since June 2022.

Sunflower Meal Prices Rise Amid Strong Feed Market

Sunflower meal export prices for delivery to ports saw an increase of $5 per ton last week, reaching $190-195/t. This rise is attributed to the increasing prices of feed wheat and corn. However, with a growing number of offers for rapeseed and soybean meal on the global market, this upward trend in prices may soon come to a halt.

Sunflower Prices Continue to Rise as Farmers Hold Back Sales

Demand prices for sunflowers have also increased, rising by another UAH 500-1,000/t during the past week to UAH 20,000-20,800/t ex-factory. More factories have started processing, yet farmers are holding off on selling their crops, which is pushing prices higher.

Global Soybean Oil Prices Drop, But Recovery is in Sight

Soybean oil futures for December on the Chicago Mercantile Exchange fell by 2.4% last week to $905/t, marking a 2.8% increase for the month. This decline follows a drop in August to multi-year lows, though prices are beginning to recover.

Outlook: Potential Pressure on Sunflower Prices

At present, sunflower prices remain high enough to provide a margin for processors. However, if global prices for meal and oil do not experience a significant rise, processors may be forced to lower their purchase prices in the near future.

Ukraine’s sunflower market is in a delicate balance right now. On one hand, the dry weather has sped up the harvest, but on the other, it has reduced yield potential, which could have longer-term implications for supply. The rising demand for sunflower oil and meal is supporting prices for now, but the situation remains volatile. Global price movements, particularly in related markets like soybean and rapeseed, will be crucial in determining the direction of sunflower prices in the months ahead. Processors and farmers alike should stay vigilant as they navigate these shifting dynamics.