Kernel believes that Ukraine has never faced such a significant shortage of sunflower seeds
The imbalance between processing capacity and sunflower seed supply this year could reach approximately 10.2 million tons, which will increase competition between plants for raw materials and create significant pressure on processing margins. This is stated in the Kernel report for the first quarter of the 2026 financial year (July-September).
“The market environment for the oilseed processing segment in the current season looks more difficult than last year. As the harvesting campaign is completed, our forecast for the sunflower harvest in Ukraine in 2025 remains at 11.4 million tons, which is the lowest figure in the last ten years,” the report says.
The company noted that the market has never faced such a significant deficit, due to which “almost half of the national processing capacity may remain underutilized.”
Processors that can temporarily switch to other oilseed crops — soybeans or rapeseed — are likely to have a more stable season, partially compensating for the shortage of sunseed, Kernel believes.
In the first quarter of the 2026 fiscal year, the agricultural holding processed 559 thousand tons of oilseeds, which is 18% less year-on-year, mainly due to a reduction in the volume of toll processing (16 thousand tons versus 132 thousand tons last year).
The bulk of the processing was sunflower seeds, supplemented by smaller volumes of soybeans and rapeseed.
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