Why edible oil processors in Ukraine have stopped building new plants

The global vegetable oil market today resembles a large chessboard where Ukraine, despite the war, remains a key player. However, the rules of the game have fundamentally changed: instead of building large-scale mega-plants, the industry has entered an era of “silent investments” aimed at improving efficiency at existing facilities, while global competition has become significantly more intense.

At the BLACK SEA GRAIN.KYIV-2026 conference, leading experts explained why building new oilseed crushing plants in Ukraine is currently economically unjustified, and how the market is facing a shortage of raw materials amid excess processing capacity.

Why “UkrOliya” is not building new plants

For large businesses, security remains a critical factor, but the issue goes beyond wartime risks. The market is already oversupplied with crushing capacity while raw material availability is limited. According to Artem Skliarenko, Deputy Director for Strategic Planning at “UkrOliya,” processing capacity significantly exceeds sunflower seed supply.

“Given the current oversupply of processing capacity, there is no sense in building another plant. Today, sunflower seed production in Ukraine covers only about 60% of processing demand,” he noted.

Instead of expanding capacity, the company focuses on improving efficiency of existing facilities and reducing energy consumption. A key priority is high-margin niche products such as high-oleic and organic sunflower oil.

Global competition

Ukraine remains the world’s largest exporter of sunflower oil (about 33% of the market), but Russia is actively strengthening its position, taking advantage of Ukraine’s logistical constraints.

According to UkrAgroConsult analyst Maksym Kharchenko, Russia has already partially captured Ukraine’s traditional export markets, including India, and is also expanding in Turkey and China.

Top exporters include:

• Ukraine — 33%
• Russia — 30%
• Argentina — 14%
• Turkey — 5%
• Kazakhstan — 5%

Ukraine remains export-oriented, as domestic consumption is only around 300 thousand tons versus export potential of up to 6 million tons.

Rapeseed breakthrough

In 2026, sunflower crushing margins are around 7%, but rapeseed and soybeans have become the main growth drivers. Thanks to export duties on raw seeds, crushers gained more domestic supply.

Rapeseed oil exports have doubled, while soybean meal exports increased by around 1.5 times. Ukraine remains strong in the EU market, while Russia is expanding rapeseed acreage targeting China.

Tags: sunflower oil, oilseeds, sunseed, edible oils, BLACK SEA GRAIN.KYIV - 2026