Sunseed market – Who are the players? Farmers versus oil producers

Sunseed is a crucial crop for Ukraine’s sunflower oil industry to function smoothly. During 2022/23 season, the market adjusted to the military risks, with a considerable quantity of sunflower seed were exported.

In the 2022/23, almost 1.9 M mt of sunflower were exported, whilst 13.5 M mt were crushed domestically. So high crushing was possible thanks to the large carry-over stocks.

Exports saved Ukrainian farmers’ incomes by providing better prices, as there was competition between crushing industry and exporters. This also put pressure on the European importers that enforced an import ban on sunflower seed.

In the 2023/24 sunseed season  five EU nations extended import ban until November 30. Furthermore, Ukraine has implemented sunseed export licensing since November.

Under the current regulations, sunseed exports in 2023/24 will likely to decline by almost 80%. However, any modifications to the licensing restriction will modify again the export size.

The 2023 sunflower crop is predicted to be at 14.2 M mt (November 2023 forecast, +17% from 2022). Since there are no significant carry-over stocks, sunflower supply for the 2023/24 season will be nearly 80% lower compared to the previous season. Export restrictions are in favour of oil producers as lower exports will offset the decreased sunflower supply.

In the first quarter of the 2023 season (Sept.-Nov.), sunflower oil and sunflower meal exports fell by 14% and 3% respectively, reflecting the reduction in sunseed supply.

In early December, sunflower supplies remained tight as farmers waited for prices to rise. From 15-17 November, prices went up and reached the level they were before the harvest and before the sudden supply increas.