Sunseed prices in Ukraine are growing faster than sunflower oil prices: processing margins are shrinking

In the domestic market of Ukraine, sunflower prices are growing faster than sunflower oil prices, which is reducing the processing margin. This is reported by brokers Spike Brokers.

Over the past week, sunflower indicators have risen to $709 per ton (CPT, processing), adding about $6. At the same time, sunflower oil prices remain less sensitive to global growth and do not demonstrate the same dynamics.

“This configuration leads to a revision of the processing economy: the rate of increase in seed prices is ahead of the dynamics of products, which reduces the potential margin of factories and increases the requirements for purchasing discipline,” the brokers note.

In the physical EU market, demand for sunflower oil remains uniform, without sharp impulses, which limits the possibility of quickly transferring the increase in the cost of raw materials to the final product. The market remains relatively inert – quotes are held near $1,450.

At the same time, the global vegetable oil market continues to show an upward trend: palm and soybean oils are becoming more expensive amid high energy prices.

Tags: sunflower oil, prices, sunseed, margin