According to MARS, sunflower sowing started early (end of March) in the main EU sunflower producing countries of Romania and Bulgaria, thanks to unusually high temperatures. From mid-April, weather turned rainy and colder, slowing sowing progress and causing some delays in sprouting. Nevertheless, planting progressed rapidly and is currently (mid-May) nearing completion.
In contrast to sunflower, the average yield for rapeseed was reduced from 2.98 mt/ha in the April report to 2.78 mt/ha, which is now 8% lower y/y (3.01 mt/ha) due to below-average rainfall.
This figure is roughly in line with the average of the last 5 years, so the high Australian wheat production should increase global supply of the cereal in the new season.
The country is also forecast to harvest 10 million tons of barley (-7.2% y/y) and 5 million tons of canola (-11.4%) this year. The expected canola harvest is roughly in line with the five-year average, while barley is 2 million tons below average.
He specified that in 2022/23 MY Kazakhstan produced 557.58 thsd tonnes of vegetable oils, up 59% y-o-y. At the same time, sunflower oil accounted for 75% of the total production.
At the same time, the production of high-protein feed (meal and cake) is growing, which directly affects the development and competitiveness of livestock and poultry farming in the country. The share of feed in the cost of finished products is at least 70%, said Mr. Ibragimov.
According to the monitoring data of the European Commission specialists, 11.9 million tons of soybeans (-1% for the year), 5.1 million tons of rapeseed (-29%), as well as 645.2 thousand tons of sunflower seeds (-70%) were imported into the EU territory during the reporting period.
The main suppliers of these products to Europe for 10 months were Brazil, USA, Australia, Uruguay, Canada, Ukraine, Turkey, Moldova, Serbia and China.
Against the background of lower purchases of raw materials, the EU countries increased imports of vegetable oil by 3% (from July 1, 2023 to June 2, 2024). At the same time, imports of palm oil fell to 3.1 million tons (-19% for the year), but sunflower oil increased to 2.5 million tons (+54%), rapeseed oil – to 430.54 thousand tons (+16%), soybean oil – to 491.7 thousand tons (+2%).
During the week, purchase prices for sunflower increased by another 500-1000 UAH/t to 20,300-21,000 UAH/t (including VAT) or 440-460 $/t amid limited supply from farmers at the end of the season. This week, large volume purchases were recorded in the market at prices around 20,300-20,600 UAH/t on FCA-farm and EXW-elevator terms.
Export prices for sunflower oil with delivery to Black Sea ports jumped by 100 $/t over the month to 890-900 $/t due to a significant increase in exports in May to 720 thousand tons compared to 626 thousand tons in April, driven by increased demand from India. Last week, demand prices reached 920 $/t in Ukrainian ports, exceeding the demand prices for delivery to Bulgaria, which remain at 880-890 $/t.
Processing plants operate with minimal profit in anticipation of the new oilseed season.
“The current prices often bring minimal profit or even losses to the plants, but their main goal is to maintain operations until the rapeseed season starts, when a new crop will be processed. Sunseed prices are expected to rise further this week. The crushers will continue to buy sunseed at the current prices, which range from UAH 18,100-18,200. By the end of the week and the beginning of the next week, purchase prices are expected to reach 19 thousand hryvnias per ton,” the PUSK forecasts.
The proposal discussed in April to increase import duties on Russian agricultural products, including flaxseed, was officially confirmed at the end of May. With regard to flaxseed from Russia, the import duty will be 10% in the first instance until 31 December 2024. This will be followed by an increase to 20% on 1 January 2025 and from 1 January 2026, a 50% import tax will be levied on flaxseed imports from Russia.
According to dealers, the price of imported crude palm oil (CPO) is 948 $/t CIF (including cost, insurance and freight), while soybean oil is offered at 1028 $/t, and sunflower oil – at 1035 $/t CIF.
the Increase in imports of palm oil contributed to the growth of the margin in the purchase of refined palm oil, so that its imports in may increased compared to April from 124,2 to 214 thousand tons. Experts expect that in June India will import about 750 thousand tons of palm oil.
The data of the Indian Association of Manufacturers (SEA) on May imports will be released in mid-June. Recall that India buys palm oil mainly in Indonesia, Malaysia and Thailand, and soybean and sunflower oil in Argentina, Brazil, Ukraine and Russia.
Ukraine due to increased demand from India and Spain increased exports of sunflower oil in may by 13.7% to 714,3 thousand tons, the highest level since November 2020.