Prices for Ukrainian sunflower oil have increased by 4% since the beginning of the week, amid delays to harvesting and farmers holding on to their sunflower stocks, while the supply of Russian sunflower oil in the Black Sea region is constrained by tax limits in a move that is adding further support to prices.
Prices for October loading as of September 15 jumped to a seven-year high of $1,305/mt on an FOB basis.
This was facilitated by the limited supply of sunflower, which in turn has fueled an 8% increase in the domestic CPT market since the beginning of the week, rising to UAH18,500/mt ($695/mt).
“Sunflower harvesting lags significantly behind. Up to 10% has been harvested today. I think that by October 1, sunseed will be actively harvesting and prices will begin to decline,” a trade source at a crusher based in central Ukraine told Agricensus.
“In the face of higher prices by crushers, farmers have begun to hold back sales and wait for further price increases,” a market source said.
“Depending on the region and the progress of harvesting, we sometimes see enough offers of sunflower. When competing for raw materials, crushers raise prices,” a source at a crusher in the southern region said.
The supply of sunflower oil in the Black Sea is limited by the late harvesting of sunflower in Ukraine and Russia, while in addition to that, the export duty on sunflower oil from Russia makes exports unattractive in October.
“Sunoil sellers are still announcing high prices, as the domestic market has dried up and pays significantly higher, up to RUB80,000-87,000/mt ($1,076-1,089/mt), than an exporter who is ready to pay RUB80,000-87,000/mt ($1,103-1,200/mt) in the CPT port,” a trader based in Russia said.
According to the Ministry of Agriculture of Ukraine, 344,000 ha – or 5% of the planned area – were harvested in Ukraine on September 10, while 715,450 mt of sunflower were harvested.
At the same time, according to market estimates, about 15-20% or about 2.2-3 million mt have been harvested.