Sunseed prices continue to rise in Ukraine, but vegetable oil markets have seen a drop in prices

Rising prices for sunflower oil in Ukrainian ports have allowed for higher purchase prices for sunflower, but farmers continue to hold back sales in anticipation of the desired level of UAH 30,000/t. At the same time, India’s planned increase in import duties on vegetable oils may halt the rise in prices for both oil and sunflower seeds.

During the week, export prices for sunflower oil in Ukrainian Black Sea ports increased by $10–20/t to $1,110–1,120/t, while prices for sunflower meal remained at $220–225/t. Against this background, purchase prices for sunseed with an oil content of 52% increased by UAH 500–1,000/t to UAH 27,500–28,500/t with delivery to the plant.

According to Trading Economics, the average price of sunflower oil delivered to customers increased by 1.3% to $1,363/t (+7% per month), but this figure takes into account the duty in India, therefore it does not fully reflect the situation on the market.

Prices for palm and soybean oil have fallen sharply amid news of the Indian government’s plans to raise import duties on vegetable oils to support local producers. Recall that in September 2024, India already introduced a 20% basic duty on crude and refined oil, after which the import duty on crude (palm, sunflower and soybean) oil increased from 5.5% to 27.5%, and on refined oil – to 35.75%.

According to traders, Indian processors have canceled orders for 100,000 tons of crude palm oil, which was due to be delivered in March-June, due to a sharp increase in base prices in Malaysia and negative refining margins in India.

April palm oil futures on the Bursa exchange in Malaysia fell 2.3% yesterday to 4,559 ringgit/t or $1,034/t (0% for the week) under pressure from weak export growth in February and forecasts of increased palm production.

March soybean oil futures on the Chicago Board of Trade yesterday fell 2.4% to $1,007/t (+0.9% for the week, +1.6% for the month) amid accelerated soybean harvest in Brazil, rainfall in Argentina, and reduced biodiesel production in the US.

In Ukraine, small processors continue to be idle due to low (or sometimes negative) margins on sunseed processing, so only a few large plants buy it, which reduces competition in the market. This will stop further growth in sunseed prices, especially given the decline in quotes in neighboring markets. In addition, soybeans in Brazil have already been harvested on 40% of the area, and dry weather will allow the harvest to be completed in the coming weeks, which will increase pressure on soybean oil prices.

Tags: prices, sunseed, Ukraine, sunflower oil