There is still high demand for sunflower in Ukraine, but more and more oil mills are forced to stop processing raw materials. The reason was the significant increase in the cost of seeds, which reduced the profitability of production and forced enterprises to temporarily suspend work in anticipation of the new rapeseed season.

This was reported by the Electronic Grain Exchange of Ukraine. According to market data, processors are increasingly reviewing their production plans due to the imbalance between the cost of raw materials and prices for finished products.

During the week, purchase prices for sunflower with an oil content of 50% in Ukraine were in the range of 31,300–33,500 UAH/t, or 630–660 dollars per ton excluding VAT. Some processors, who did not form sufficient stocks, were forced to increase purchase prices to ensure the supply of raw materials.

At the same time, other companies, on the contrary, reduced prices, as they already had sufficient reserves to work before the start of rapeseed processing. For large batches of sunflower, buyers paid up to 34,000 UAH/t with delivery to the plant, but the need for additional purchases before the new season remains limited.

Against the background of a supply deficit, prices for finished products are also growing. Over the week, Ukrainian sunflower oil rose by $10 per ton and amounted to $1,325–1,330 per ton with delivery to Black Sea ports.

The increase in prices is explained by a reduction in supply due to the shutdown of some plants that are preparing to switch to rapeseed processing. At the same time, exporters are facing complications due to risks associated with shelling of port infrastructure and possible damage to terminals and production facilities.

In parallel, the sowing campaign is underway in Ukraine. As of May 25, 4.34 million hectares were sown with sunflower, which is 87% of the planned 5 million hectares. Natural conditions — cool weather and periodic rains — contribute to the development of crops and allow farmers to quickly complete sowing.

At the same time, high prices for the crop may encourage farmers to expand sunflower sowing areas in the future. This could potentially affect the supply balance on the market in subsequent seasons.

Meanwhile, competition is intensifying on the global market. Active supplies of sunflower from Argentina to Bulgaria and Turkey have increased the supply of sunflower oil, which affects price dynamics in different regions.

Argentine sunflower oil has risen in price by $10–20 per ton and is $1,340–1,380 per ton FOB due to increased demand. At the same time, Russian sunflower oil fell by $10 per ton to $1,290 FOB as sellers are forced to compete with more expensive Argentine supplies.