Business news from Ukraine

Ukraine has lost its place in global market of high-oleic sunflower and oil

10 October , 2023  

In 2022-2023 marketing year (MY), the planted area and production of high-oleic sunflower in Ukraine were the lowest in recent years.

According to the analytical agency UkrAgroConsult, in 2023-2024 MY the planted area is expected to increase slightly, but the production figures will remain extremely low.

“Before the war, the processing of high oleic sunflower reached almost 500 thsd tonnes, which is a good result for such a niche segment. Unfortunately, due to the war, Ukraine has lost both the results gained over the years and its share in the global high-oleic oil market,” the analysts stated.

They noted that high oleic oil remains an export-oriented commodity and almost all of it is exported.

The key issues remain the war, instability in the grain corridor and the ban on imports of agricultural products from Ukraine to Eastern Europe, which will affect the market of high-oleic sunflower, the experts emphasized.

However, according to analysts, the main factor limiting the expansion of the area under high-oleic sunflower in Ukraine is the unstable margin for agricultural producers.

“Sometimes low or no premium entails selling high-oleic seeds at the price of conventional raw materials, which does not always cover the cost of production. This leads to the refusal of agricultural producers to grow this type of sunflower or to reduce the area,” UkrAgroConsult emphasized.

The analysts reminded that before the war, the crushers encouraged farmers to grow high oleic sunflower: they offered to enter into forward agreements, provided seeds for growing with the subsequent purchase of raw materials with a premium.

“Starting from 2023-2024 MY, Ukraine will see a gradual resumption of high-oleic sunflower processing and oil refining, but it is still far from reaching the pre-war levels,” UkrAgroConsult summarized.