Sunseed prices in Ukraine are formed contrary to traditional seasonality

The Ukrainian sunflower market in the current season may deviate from the traditional seasonal model. The situation is being shaped by external factors, primarily due to imbalances in the vegetable oil market, which set a benchmark for pricing in the raw material segment. This was reported by the analytical department of the agricultural cooperative PUSK, established within the All-Ukrainian Agrarian Council (VAR).

“Fundamentally, the market is supported by a reduction in production in key regions. The sunseed harvest in Ukraine, the EU and Russia was weaker than expected, which limits supply and creates the prerequisites for further price strengthening. Against this background, the domestic market is already demonstrating quite strong price positions: the conditional purchase prices for sunseed exceeded 30,000 UAH/t, which is a high level for this period of the season,” analysts note. An important benchmark for the market is the situation with vegetable oils.

“Sunseed prices directly depend on the situation on the oil market. An atypical imbalance has now formed, when sunflower oil has temporarily lost its premium to soybean oil. Such situations usually do not last long and the market evens them out,” the PUSK explains.

If soybean oil prices remain high, this will create the prerequisites for further growth in sunflower oil and sunflower seed prices. “If soybean oil remains at high levels, sunflower oil will follow suit, and this will automatically support sunseed prices. The growth potential for oil is estimated at at least $150–200/t, which may also translate into an increase in sunseed prices. At the same time, this process will not be instantaneous and may stretch for several months,” analysts predict.

At the same time, the market’s behavior in the coming months may differ from the usual seasonal model. Traditionally, sunseed prices decrease in April–June, but in the current conditions, this scenario is not guaranteed. “This season, the sunflower market may behave atypically. In the short term, some subsidence is possible, in particular due to the fact that the plants are already covered with raw materials by approximately 60–70% and may temporarily put pressure on prices. At the same time, in the medium term, the market has the potential to grow,” the PUSK summarizes.

Tags: Ukraine, prices, sunseed