According to the European Commission, from July 1, 2024 to February 2, 2025, the European Union countries imported about 1.24 million tons of sunflower oil. This is less than in the same period last year (1.51 million tons), but higher than in the 2022/23 season (1.13 million tons). The pace of imports has slowed in recent weeks: while in December up to 59,000 tons were imported weekly, in early February – less than 25,000 tons per week.
Ukraine remains the largest supplier of sunflower oil to the EU, providing 94% of imports (1.17 million tons). However, this is lower than the previous year’s figure (1.40 million tons) due to reduced raw material supplies, slower processing and limited export potential.
Serbia and Bosnia and Herzegovina are the second and third largest suppliers of sunflower oil to the EU with market shares of 3% and almost 1% respectively. However, their export volumes also declined compared to the previous year.
The decline in supplies from Ukraine, Serbia and Bosnia and Herzegovina is prompting the EU to seek new sunflower oil suppliers to compensate for the deficit and stabilize the market.
Source – TG channel Serbian Economist
The exports of high-oleic sunflower oil from Ukraine in 2024-2025 marketing year continue to decline, which is typical for the sector for the fifth consecutive season, APK-Inform news agency reported.
“In September-December of the current season, the country shipped only 57 thsd tonnes of the oil to the foreign markets, which is 52% down from the same period last season and the lowest in the last seven seasons,” the analysts said.
Moreover, the share of high oleic oil in the total exports of sunflower oil in 2024/25 MY decreased to 3%, compared to 5-8% in the previous several seasons.
“The main reasons for the decline in the supply of high oleic sunflower oil are the decrease in the production of high oleic sunflower last year and the restraint of the oilseed sales by the farmers due to the significant increase in the price of the classic hybrids of the crop and the record premiums for high oleic sunflower from the Ukrainian processors,” the experts explained.
Thus, given the available stocks of HO sunflower oil among farmers and the likely more active sales of this crop in the spring in the second half of the current season, the volumes of processing and, accordingly, exports of HO oil may increase.
According to the analysts, the potential of exports of HO sunflower oil in the season-2024/25 is about 220-240 thsd tonnes against 289 thsd tonnes in the previous season and may be the lowest in many years.
At the same time, the increase in the price of sunflower oil in the current season and high-oleic oil in particular, as well as the growth of the premium for rapeseed oil on the world market may be the additional factors of the slowdown, APK-Inform forecasts.
AllSeeds Group, one of Ukraine’s largest producers of sunflower oil and meal, has stopped buying raw materials for processing and finished products for export due to delays of ships in ports during the implementation of a new system of export security, the head of the group Vyacheslav Petrishche said on Facebook.
He recalled that on the initiative of the Verkhovna Rada Committee on Finance, Tax and Customs Policy from December 1 began to operate the export security regime to operations for the export of certain types of agro-commodities, which provides a new procedure for customs clearance of export cargoes.
“Well a good thing it seems. Allegedly to combat the shadow market and return currency to the country. I am personally unequivocally in favor of it. I have always been, am and will be against the shadow market. But can it be done not to the delight of the enemy during the bombings, but for the good of the motherland? (…) If you introduce a new procedure, can it be tested first? Will it work at all?” – wrote Petrishche.
According to his information, the authorities issued permits for loading agro-products with all necessary checks on November 29 (before the introduction of the new system – IF-U). Large ships entered Odessa seaports, carried out loading for several days and waited a long time for registration.
“Did you put all this goodness under the berths on purpose for inspection? So that the enemy could take better aim???? (…) during the war I would call it sabotage, you can’t think of anything else. (…) Well, let these boats go (the law has no retroactive effect) and do not launch new ones (and they are already waiting) until exporters submit export documents properly executed according to the new procedure”, – said the head of the AllSeeds group of companies.
Petrische drew attention to the growing losses of companies due to ship demurrage and pointed to safety problems during the downtime in the transition period when implementing the new agro-export system.
“Our company has stopped buying raw materials for processing and finished products for export. It is better to let people go home and sit with their money than to take the risk that if you are not the enemy, you will be “sheltered” by your own people. I recommend it to everyone,” Petrishche emphasized.
He reminded the head of the parliamentary finance committee, Daniil Hetmantsev, that the road to hell is paved with good intentions, and recommended him to “ruin the whole economy” on his own.
“God grant him health, and God grant the country to survive it! (…) It’s a shame for the State,” summarized the head of the AllSeeds group of companies.
Allseeds Group is one of the five largest Ukrainian producers and exporters of vegetable oils and meal. It owns an oilseed processing plant with a capacity of 2200 MT per day of sunflower seeds (or 1500 MT per day of rapeseed or 1 day of soybeans), which is located in the port “Yuzhny” (Odessa region).
Allseeds also provides transshipment services for vegetable oils and oilseed meal at its terminals in Yuzhny. The capacity for simultaneous storage of vegetable oils is more than 100 thousand tons, and of oil meal – 30 thousand tons.
In January-September 2024, MHP, Ukraine’s largest chicken producer, reduced sales of sunflower oil by 11% compared to the same period in 2023, to 330.24 thousand tons.
“The decline is primarily due to a change in the recipe for oilcake production, which led to a decrease in oil production,” the holding company said in a report to the London Stock Exchange.
“In January-September 2024, MHP also reduced sales of soybean oil by 9% compared to the same period in 2023, to 35.46 thousand tons.
Revenue of the vegetable oils segment in January-September 2024 decreased by 27% to $355 mln, which led to a decrease in adjusted EBITDA (excluding IFRS 16) to $42 mln compared to $71 mln in the same period last year, which the agricultural holding explains by a decline in both world oil prices and sales volumes.
“MHP is the largest chicken producer in Ukraine. The company produces cereals, sunflower oil, and processed meat products.
As reported, the company received $142 million in net profit in 2023 compared to $231 million in net loss a year earlier. The group’s revenue last year increased by 14% to $3.021 billion.
In the third quarter of this year, MHP earned $96 million in net profit, which is 75% higher than in the third quarter of 2023, while revenue increased by 5% to $773 million, gross profit grew by 47% to $249 million, operating profit by 62% to $154 million, and adjusted EBITDA by 56% to $173 million.
Ukraine processed about 861 thsd tonnes of sunflower in the first month of the new processing season-2024-2025, the lowest volume for September since 2014-2015 marketing year, APK-Inform news agency reported.
“This figure is almost at the level of the last year’s September volumes (-1%), however, the difference is that at the beginning of the season-2023/24 Ukrainian companies faced the difficulties in exporting due to the shutdown of Odesa ports, which restrained the more active increase of processing, while in the current season the main problem is the formation of the raw material base,” the analysts explained.
Experts noted that most farmers are not in a hurry to sell their products due to expectations of lower sunflower harvest in 2024. As a result, during September, the purchase prices for the oilseed increased and in early October reached the highest level since February 2022 – 22 thsdn/MT – 23.8 thsdn/MT.
At the same time, the price increase did not help to accelerate the sales of sunflower by farmers – the excitement created by the processors provoked the oilseed owners to slow down the sales in anticipation of new price records. At the same time, the increase in prices for raw materials is supported by the growth of prices on the export market of sunflower oil.
APK-Inform predicts that in 2024-2025 marketing year Ukraine can process the minimum amount of sunflower for the last three seasons – about 13-13.4 mln tonnes, which will be 11% lower than a year earlier.
Despite the negative expectations, Ukraine retained its leadership in the global sunflower oil market in 2023-2024 marketing year (MY), accounting for 42% of the global production, while Russia accounted for 29%, UkrAgroConsult, a Ukrainian information and analytical agency, reports.
The analysts referred to the forecast of the U.S. Department of Agriculture, according to which in 2023-2024 MY the forecast for Ukraine’s gross sunflower production due to higher yields was increased by 27% to 15.5 mln tonnes compared to 2022-2023 MY, and for Russia – by 5% to 17.1 mln tonnes.
The high exports of sunflower oil were achieved due to the increase in harvest. Stable operation of the sea corridor is becoming an important point for Ukraine in realization of the export potential: the country increased exports by 9% compared to 2022-2023 MY, Russia – by 10%, experts noted.
They noted that since the beginning of the war, the markets for sunflower oil have been redistributed. For Ukraine, the European Union has become the key sales destination. In addition, Turkey has reoriented its purchases from Russia to Ukraine, while India and China continued to increase Russian imports.
According to analysts’ forecast, 2024-2025 MY will be a bad harvest year for sunflower. According to the current USDA forecast for September 2024, the global sunflower production is estimated to be the lowest in the last four seasons due to unfavorable weather conditions in the key producing countries – 50.6 mln tonnes, which is 10% less than the previous season. At the same time, Ukraine is expected to reduce the production of this crop by 19% to 12.5 mln tonnes compared to 2023-2024 MY, and Russia – by 6% to 16.0 mln tonnes.
“Ukraine will retain the leadership, but the share in the global production will decrease to 41% vs. 42% in 2023/24 MY in favor of Russia – 33% vs. 29%. The forecast for Russia seems quite optimistic,” UkrAgroConsult stated.
