Ukrainian crushers face tight supply of old and new crop sunseeds
Ukrainian crushers are facing a tight supply of sunseeds due to farmers holding back sales of old crop and low sunseed stock, as well as limited supply of new crop as a result of the slow progress of the harvesting campaign due to rains.
Crushers in the central, northern, and some southwestern regions are reporting a lack of supply of both old and new crop sunflower as farmers hold back sales in anticipation of higher commodity prices going forward.
Given the slow pace of the harvesting campaign due to rainy weather in the main parts of Ukraine, market participants assume that mass harvesting, subject to favorable weather conditions, will begin in early October.
“Raw materials are tight, but there is no [real] shortage,” a central Ukraine crusher told Agricensus.
According to crusher estimates, market expectations of high sunseeds stocks did not materialize, and now estimates of sunseeds stocks as of September 1, 2023 are pegged at no more than 2.1 million mt at plants and from farmers in Ukraine-controlled territory.
At the same time, crushers are trying to keep prices for sunflower seeds of old and new crops within UAH14,000-16,000/mt ($327-373/mt) CPT plant including VAT, as they are limited by sunflower oil prices and the timing of the grain corridor.
Prices in the range of UAH14,000-15,000/mt ($327-350/mt) CPT plant are typical for sunflower with an oil content of 46-48%, and above UAH15,000/mt ($350/mt) CPT plant for sunflower with an oil content of 50% .
However, given the competition for raw materials between processors and exporters, individual crushers are willing to pay more than $16,500/mt ($385/mt) CPT plant for raw materials.
Exporter prices are significantly higher and range from $515/mt to $550/mt DAP in Romania, Bulgaria, and Hungary.
Exports of sunflower seeds from the beginning of the 2022/23 season to September 20 amounted to 338,367 mt, according to official data, which is the average monthly export volume over the past five months.
The active start to exports at the beginning of the season confirms the fears of crushers that sunflower exports in the 2022/23 season will not be lower than 1.6 million mt, and according to some estimates, could reach 3 million mt, mainly to Europe.
According to preliminary estimates, market sources expect a sunflower harvest of 10.3 million mt to 11.28 million mt.
According to the Ministry of Agrarian Policy, as of September 22, 672,900 ha of sunflowers or 14% of the planned areas were harvested, amounting to almost 1.3 million mt of sunflower seeds.