According to the preliminary forecast of APK-Inform, the planted area under sunflower seed will grow slightly in Ukraine in 2021. Farmers may plant the oilseed throughout 6.8-6.9 mln ha, up y 4-6% year-on-year.
It can be the record large planted area, despite the current significant delay of the planting campaign of sunflower seed if compared to the last year. Record high prices, high liquidity and good production margin will push farmers to plant more.
If the weather assists and the yield will be close to the average, the production of sunflower seed can amount to the record 16.4 mln tonnes compared to 14.3 mln tonnes the last year.
Thus, the supply and demand balance of sunflower seed may ease the next season.
“High competition, deficit of the oilseed and reserved farmers’ selling are the main supporting factors on the markets of sunflower seed and oil this season. Their influence will weaken the next season due to the expected growth of production”, - analyst of APK-Inform, Svetlana Kyrychok supposes.
She adds that the current forecast of sunflower oil production slightly exceeds 7 mln tonnes for 2021/22 MY, up by 16% compared to 2020/21 MY and close to the record of 2019/20 MY.
Ukraine can export near record 6.5 mln tonnes of sunflower oil in 2021/22 MY (+17% to 2020/21 MY, -1% to 2019/20 MY).
“Global demand for Ukrainian sunflower oil can increase sharply the next season supported by multiyear low carry-over stocks, floating export duty on Russian sunflower oil since September 1 and possible restrictions of Ukrainian sunflower oil export. At the same time, any export restrictions in Ukraine will push the prices of sunflower oil and seed up on the world market”, - S.Kyrychok points out.
If no new restrictions on sunflower seed export are implemented, it can grow significantly the next season due to the export duty on Russian sunflower seed that can be prolonged further.
Currently, the export duty on sunflower seed is set at 10% in Ukraine. However, the duty has not prevented the growth of sunflower seed export by 7 times in September-March of 2020/21 MY.