Volga Baikal AGRO NEWS Update on the Sunflower Prices !!!

The sunflower market is getting hot.....

Volga Baikal AGRO NEWS Update on the Sunflower Prices !!!

The sunflower market is getting hot. Processors warn of market collapse without restrictions on the export of raw materials.

The reduction in import duties on sunflower by Turkey, a large importer of this crop, has caused concern among Russian processors. Market participants believe that prices for raw materials as a result may jump by 25%, to more than 40 thousand rubles. per ton, which threatens to “collapse”, and advocate the earliest possible restrictions on the export of sunflower. Experts doubt the reasoning of the converters.

Turkey’s decision to reduce the import duty on sunflower from 3% plus € 100 per tonne to 0% can lead to a rise in sunflower prices in Russia by more than 10 thousand rubles. per ton and “collapse” in this market, the  Fat and Oil Union said on Thursday evening. Union executive director Mikhail Maltsev says most farmers have suspended sales in anticipation of price increases. As the union reminds, last season the Russian Federation exported 1.25 million tons of sunflower, and this season the figure can double. At the same time, local processors can accept the entire 13 million tons of sunflower harvested this year, and even in this case, the capacity of enterprises will be busy less than 70%, according to the Oil and Fat Union.

According to the Agricultural Analytics Center of the Ministry of Agriculture, from September 01 to October 04, the Russian Federation increased the export of sunflower seeds by 10.2 times, to 54.8 thousand tons year-on-year. Turkey accounted for 40.6% of supplies. The director of Sovecon, Andrei Sizov, points out that Turkey’s decision to zero the import duty on sunflower will not fundamentally affect the price of the crop. Sunflower quotes depend on world oil prices and the amount that processors are willing to pay, who are often the only buyer of sunflower for hundreds of kilometers, he recalls.

According to Sovekon, last week sunflower prices increased by 275 rubles, to 31.82 thousand rubles per ton without VAT, which became a new record.

Russian sunflower oil on the world market rose by $ 15 to $ 985 per ton (FOB), supported by higher prices for soybean and palm oil, analysts said.

According to Mikhail Maltsev, the adoption of protective measures to prevent the massive export of oilseeds from the country is planned to be discussed on November 09 at a meeting of the subcommittee on customs tariff and non-tariff regulation and protective measures in foreign trade. Without the introduction of restrictions on the export of sunflower, the risk of a complete halt in the oil and fat industry becomes quite obvious, he stressed. In spring, the subcommittee on customs-tariff and non-tariff regulation, protective measures in foreign trade decided to increase the export duty on sunflower seeds from February 01, 2021 to 20%, but not less than € 80 per ton. Today the duty is 6.5%, but not less than € 9.75 per ton.

Andrey Sizov predicts that prices for Russian oil and sunflower seeds, regardless of Turkish duties, are likely to continue to rise in the coming weeks. The main reason is the devaluation of the ruble in previous months and the rapid rise in world prices for oil, which have strengthened by 1.5 times since March. Russia exports about half of the sunflower oil produced, reminds Mr. Sizov. According to him, the statement of the processors can be related to the desire to rather limit the export of sunflower in addition to the current export duty.

Source: OilWorld.ru

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