The global sunflower production forecast has been increased due to a good harvest in Ukraine and Russia.

In the August report, USDA experts increased the forecast for global sunflower production in the 2023/24 marketing year by 2%, due to favorable weather conditions and a good harvest in Ukraine. This harvest is expected to exceed the 2022/23 level by 6.4%, but will still be 2% lower than the record level of 2021/22.

USDA experts raised the forecast for global sunflower production by 1.1 to 55.8 million tons (compared to 52.441 million tons in 2022/23), including an increase for Russia by 1 to 17.5 (from 16.254) million tons and for Ukraine by 1.1 to 13.5 (from 12.2) million tons. However, the Uzbekistan Agriculture Ministry assesses it at 12.7 million tons. Production estimates were lowered for the EU by 0.65 to 10.85 (from 9.207) million tons, China by 0.14 to 2.25 million tons, Kazakhstan by 0.1 to 1.3 million tons, and Turkey by 0.1 to 1.65 million tons.

The forecast for sunflower exports in the 2023/24 marketing year has been reduced compared to the previous season, from 4.6 to 3.67 million tons, including Ukraine’s forecast dropping from 2.025 to 0.8 million tons. It’s worth noting that the export forecast for 2022/23 remains at 2.025 million tons, although the actual exports from September to July were only 1.85 million tons, making it unlikely to ship 175,000 tons of sunflower during August.

The forecast for sunflower processing in the 2023/24 marketing year has been raised for Ukraine by 0.6 to 12.7 million tons and for Russia by 0.6 to 16 million tons, while it has been lowered for the EU by 0.4 to 10 million tons.

The estimate for global ending sunflower stocks has been raised by 0.571 million tons to 5.217 (from 5.614) million tons, including an increase for Ukraine by 0.5 to 1.6 million tons and for Russia by 0.33 to 1.307 million tons, while the forecast for the EU has been reduced from 0.636 to 0.424 million tons.

In Ukraine, there’s an increase in demand for sunflower towards the end of the season due to reduced stocks and growing demand for sunflower oil in the EU. However, as the supply of new rapeseed oil increases and sunflower harvesting approaches, vegetable oil prices are expected to decrease.

Purchase prices for sunflower remain at the level of 15,000-16,000 UAH/ton with delivery to the plant. However, the blockade of vegetable oil and meal exports from Black Sea ports will exert pressure on prices if processing volumes increase.