Andrey Sizov
04.12.2024
Last week, average sunflower prices in the European part of Russia. decreased by 550 rub to 40,625 rub/mt ($383/mt), according to SovEcon analysts. This marks the first price decline since the end of August. The sunflower market has turned down due to falling oil export prices and reduced demand from processors.
Export quotes for sunflower oil began to decline, dropping by $5 to $1,110 per mt FOB last week. We believe that sunflower oil prices have peaked and will continue to decrease amid weakening prices for other vegetable oils. Over the week ending November 28, export quotes for soybean oil fell by $13 to $1,145 per mt FOB.
It’s likely that the reduced sunflower crop in the Black Sea region has already been sufficiently reflected in the prices. Against this backdrop, demand from processors has recently begun to decrease.
The weakening of the ruble partially contained the fall in sunflower prices. Last Friday, the Central Bank of Russia set the USDRUB rate at 109.6, 9% higher than the previous week.
The Russian Ministry of Agriculture has proposed changing the calculation of the export duty on sunflower oil starting in February, to be based on the current month’s price index rather than the previous month’s index. The change could lead to a reduction in export tax amid expected weakening sunflower oil prices.
Despite the fall in sunflower prices, the crop remains highly profitable for the Russian farmers, who are likely to try again to expand planting areas for oilseeds, primarily at the expense of wheat.
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