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Black Sea sunflower oil prices have fallen by at least 7% over the past month and continue to decline, weighed down by the increased availability of soybean oil relative to other vegetable oils, weak demand from key buyers amid ample short-term coverage and competitive prices from Russian sellers due to a higher-than-expected sunflower harvest in Russia, as well as the deferred EU Deforestation Regulation policy, which kept the palm oil and soy oil supply unhindered.
“Primarily, soybean oil is now available at a considerable discount among four vegetable oils (palm oil, soybean oil, sunoil and rapeseed oil) thanks to strong soybean crops in North and South America. The election of [Donald] Trump as US President has also raised questions about US biofuel policy, pushing out excessive soybean oil from the US markets via export routes,” Anilkumar Bagani, head of research at Mumbai-based vegoils broker Sunvin Group, told Fastmarkets.
Over the past month, export prices for sunflower oil have fallen by around 7-10%, or $80-130 per tonne, depending on the destination. On Tuesday December 17, according to Fastmarkets’ sources, sunflower oil was offered at an average of $1,160 per tonne CIF Mersin and CIF India, delivery in December-January.
Prices from European buyers have fallen by $80-90 per tonne, or almost 7%, over the past month to $1,180-1,190 per tonne CIF Seville, delivery in January-February. Prices have stabilized on the sellers’ side, while buyers are not showing interest.
“Relatively high prices for sunflower oil have reduced consumer demand for it for a period of time, while cheap soybean oil is putting pressure on sunflower oil in destinations where they can replace each other,” Sergiy Repetskyi, managing partner of Sunstone Brokers, said.
The spread between India soybean oil and sunflower oil this week reached $95 per tonne for January delivery, sources told Fastmarkets. On Tuesday, the spread has significantly narrowed to an average of $30 per tonne as a result of the continuing decline in vegoil prices.
On Tuesday, soybean oil was offered at $1,132-1,150 per tonne CFR India for delivery in January, depending on origin, and sunflower oil was offered at $1,160 per tonne CIF India for delivery in December-January, according to Fastmarkets’ sources.
For a long time, Ukrainian sellers have been trying to keep sunflower oil offer prices high, given the high cost of processed raw materials and low availability of seeds due to weak sales by farmers.
However, aggressive offers of Russian sunflower oil and the willingness to sell it cheaper have put additional pressure on the market, especially in Turkey.
“At origins, we see no super stock but a good enough volume, which is looking at demand on the spot and prices are under pressure as sellers want to move their stock before the New Year,” Repetskyi said.
“Turkey is well covered for the short term. There is still demand for the first quarter of 2025, and many Russian sellers have scared off buyers, but this is a typical buyer tendency to wait and see while the market is coming down,” Onat Angi, chairman of the Solventum brokerage.
“As soon as Russian sellers started dumping spot to avoid a higher export tax in January, they triggered a sales rush and scared off buyers in all directions,” the chairman added.
At the same time, a number of sources suggest a resumption of price growth after the New Year holidays, and one reason cited is the reduction in crushing by Ukrainian plants due to the suspension of processing or due to negative margins.
“Black Sea crush will slow down for the Christmas and New Year period first due to poor coverage of the plants. Most likely, we will not see much activity from buyers before January 10,” Repetskyi said.
According to Ukrainian customs statistics, sunflower oil exports from September to December 16 amounted to 1.5 million tonnes at the beginning of the 2024/25 season, which is in line with last year’s level for the same period.
According to Ukrainian analytical agency APK-Inform, sunflower exports in the 2024/25 marketing year could amount to 5.5 million tonnes.
However, some market sources doubt this figure, given the low sunflower harvest in Ukraine and estimated exports at 5.1 million tonnes.