After the winter pause, the Ukrainian sunflower market is going through a new stage - a sharp increase in supply and restart of processing plants bring exports to a record level, but this may result in further price reductions.

It was reported by the analytical department of the First Ukrainian Agricultural Cooperative (FUAC), created within the UAC.

“As of April 14, 234,000 tons of oil have already been shipped, and about 480,000 tons have been contracted for the month. That means, we are moving very fast, and by the end of April we may reach record volumes,” the analysts said.

The launch of new processing capacities and greater availability of raw materials led to an increase in sunflower seed processing. After several months of decline, the figures returned to last year's levels: in December-February, 800,000-900,000 tons were processed, in March - over 1 mln tons, and in April, 1.2-1.3 mln tons are expected.

“Over the past few months, we have significantly dropped: processing has been in the range from to 900,000 - 1 million tons. But now we see a recovery: sunflower supply has increased, and processing has revived. This allows Ukraine to increase its oil exports to the global market,” commented the FUAC.

However, the positive dynamics of export volumes is constrained by the volatility of the global market, in particular the situation with US duties. Donald Trump's recent statements about the possibility of imposing restrictions have forced the EU to prepare for mirror steps - in particular, with regard to soybean oil, which is a competitor to sunflower oil. This news caused short-term fluctuations: soybean oil fell in price, followed by sunflower oil.

“As soon as it was announced that the duties would be postponed for 90 days, the European oilseed market reacted immediately - prices dropped by USD 20-30. The decline affected both FOB and CPT markets. That is, the pressure is palpable, and it is being passed on to the domestic market,” the analysts explained.

An additional pressure factor is accumulated seed stocks. Due to the slowdown in winter processing, Ukrainian farmers have saved significant volumes of sunflower seeds. Now they are gradually entering the market, creating an oversupply.

The analysts believe that the main trend in the coming weeks is a decline in prices, and by the end of May the price of sunflower is likely to drop to 24,000-25,000 UAH/t.

“If anyone still has sunflower, they should look at the second half of April. Perhaps, we will see a temporary small increase - by 200-400 UAH/t - and this will be the moment to fix the profit. Prices are likely to go down further,” the experts believe.