Revival of the sunflower export market supports domestic prices - analysts

09/10/2023 12:15

In September, sunflower exports from Ukraine amounted to more than 12,000 tons, which was twice the August figure, but still significantly inferior to the volume of September last year (-93%). This was reported by analysts of AI "APK-Inform".

The main volumes of shipments were sent to Moldova (about 41%) and Turkey (31%), and only 4% to Bulgaria.

At the same time, analysts noted that in September 2022, the main importer of Ukrainian sunflower was Bulgaria. Ukraine put 74,000 tons of oil there.

This year, as a result of restrictions on the import of 4 agricultural crops, including sunflowers, introduced by 5 EU countries, this direction was closed for Ukraine.

By the way, after the European Commission lifted the ban, Bulgaria announced that it would not immediately resume the import of Ukrainian sunflower, so as not to collapse the domestic market, despite the rather high demand for it from Bulgarian processors. However, supply contracts were concluded and, according to market operators, some shipments in this direction did take place in the two weeks of September.

"At the same time, the recovery in the Ukrainian export market of this oil to a certain extent supported domestic prices, which have already begun to recover after a significant decrease at the beginning of the new season. However, domestic processing enterprises remain the main buyers of sunflower in Ukraine," Svitlana Kyrychok, oil market analyst of the APK-Inform agency, noted.

Yes, export-oriented companies create additional competition on the market, but this is more typical for southern and western regions.

But currently the farmers themselves are not ready to sell the raw materials at the set prices, and the lack of precipitation since the beginning of harvesting has contributed to the storage of sunflowers without additional costs for drying, as evidenced by the recent increase in demand for storage capacity. Such a trend forces processors to raise demand prices, and this is also supported by the increase in the value of sunflower oil on the export market.

"In case of an active recovery of exports to EU countries, in particular Bulgaria, agricultural producers will, of course, be in a more advantageous position. But the questions — when it will happen and how licensing will work — remain open for now," the analysts concluded.

In September, sunflower exports from Ukraine amounted to more than 12,000 tons, which was twice the August figure, but still significantly inferior to the volume of September last year (-93%). This was reported by analysts of AI "APK-Inform".
The main volumes of shipments were sent to Moldova (about 41%) and Turkey (31%), and only 4% to Bulgaria.
At the same time, analysts noted that in September 2022, the main importer of Ukrainian sunflower was Bulgaria. Ukraine put 74,000 tons of oil there.
This year, as a result of restrictions on the import of 4 agricultural crops, including sunflowers, introduced by 5 EU countries, this direction was closed for Ukraine.
By the way, after the European Commission lifted the ban, Bulgaria announced that it would not immediately resume the import of Ukrainian sunflower, so as not to collapse the domestic market, despite the rather high demand for it from Bulgarian processors. However, supply contracts were concluded and, according to market operators, some shipments in this direction did take place in the two weeks of September.
"At the same time, the recovery in the Ukrainian export market of this oil to a certain extent supported domestic prices, which have already begun to recover after a significant decrease at the beginning of the new season. However, domestic processing enterprises remain the main buyers of sunflower in Ukraine," Svitlana Kyrychok, oil market analyst of the APK-Inform agency, noted.
Yes, export-oriented companies create additional competition on the market, but this is more typical for southern and western regions.
But currently the farmers themselves are not ready to sell the raw materials at the set prices, and the lack of precipitation since the beginning of harvesting has contributed to the storage of sunflowers without additional costs for drying, as evidenced by the recent increase in demand for storage capacity. Such a trend forces processors to raise demand prices, and this is also supported by the increase in the value of sunflower oil on the export market.
"In case of an active recovery of exports to EU countries, in particular Bulgaria, agricultural producers will, of course, be in a more advantageous position. But the questions — when it will happen and how licensing will work — remain open for now," the analysts concluded.
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