Record Sunseed Plantings Forecast for Ukraine and Russia
The first half of the oilseed season 2015/16 was not easy for the processing enterprises of Ukraine. 26% devaluation of the hryvnia has led to a rapid increase in domestic prices for raw materials (sunflower).
Since September, prices rose by 39% and reached an unprecedented level - 10 750 USD/ton (peaked on the 20th day of February 2016), which took place against a background of falling export prices for sunflower oil on the world market (-12% from September to March).
Farmers in Ukraine and Russia are likely to plant a record area to sunseed in 2016. Oil World expects Ukrainians to plant 5.8 million hectares this year, up from 5.35 million hectares in 2015. Russian farmers are anticipated to plant 7.3 million hectares, an increase from 7.1 million hectares last year. Sunseed is apparently the most lucrative crop in both countries and had a profitability ratio of 63 percent last year versus only 19 percent for corn. USDA estimates the 2015 sunseed production for Ukraine and Russia at 11.3 MMT and 9.095 MMT, respectively.
Oil World also expects both countries will increase their plantings of soybeans this year. It forecasts the planted area will rise in Ukraine from 2.15 million hectares last year to 2.25 million hectares and in Russia from 2.1 to 2.2 million hectares. Last year’s Ukrainian and Russian soybean production totaled 3.925 MMT and 2.64 MMT, respectively