Sunseed prices in Ukraine continue to rise, but the fall in vegetable oil prices is accelerating, so we expect a decrease in sunflower oil prices as well

Following the sharp drop in oil prices, demand in the biofuel market has fallen sharply, leading to lower prices for palm, rapeseed and soybean oils, and increasing pressure on sunflower oil prices.

Sunseed purchase prices in Ukraine continued to rise this week as processors were able to successfully sell oil and now have to cover the need for raw materials, but farmers should hurry, given the dynamics of price declines in neighboring soybean and rapeseed markets.

This week in Ukraine, prices for sunseed with 50% oil content increased by another 200-300 UAH/t to 26,500-26,800 UAH/t or $555-565/t excluding VAT with delivery to the factory, against the backdrop of the rise in the dollar exchange rate and prices for sunflower oil.

Export prices for sunflower oil in Ukraine are currently at $1,100–1,110/t with delivery to Black Sea ports, but there is an increase in the supply price of Russian oil to $1,130–1,150/t FOB.

It is worth considering that Argentina is actively increasing the processing and export of sunflower oil against the background of a record harvest. According to Oil World, in May, sunflower processing in Argentina increased to a multi-year maximum of 466 thousand tons compared to 420 thousand tons in April and 372 thousand tons in May 2024. At the same time, exports of Argentine sunflower oil in May increased by 171 thousand tons, and in total for the first 5 months of the year amounted to 532 thousand tons, of which 223 thousand tons were sent to India (last year 211 thousand tons).

Prices for sunflower oil delivered to India fell by $20/t to $1,195-1,200/t CIF Mumbai in a week, due to lower palm oil prices.

August palm oil contracts on the Bursa Malaysia exchange fell by 3.4% to 3,965 MYR/t or $936/t during the week amid a sharp decline in palm oil exports from Malaysia, which showed growth of only 6.6–6.8% during June 1–25, although in the first 15 days of June they were ahead of the May figure by 17.7–26.3%.

July soybean oil futures in Chicago fell 5.8% to $1,141/tonne (+4.6% month-on-month) following a decline in oil and soybean prices.

It is worth noting that on the Chinese Daylian exchange, the price of soybean oil for delivery in June remains at $1,120-1,130/t, while the price of Brazilian soybean oil has decreased to $1,060-1,070/t FOB Brazil.

The vegetable oil market will remain under strong pressure from falling oil prices and increasing supply of soybean and rapeseed oil, so we expect that sunflower prices in Ukraine will start to fall again.

Tags: Ukraine, sunflower oil, prices, sunseed