Late September

Dear community, Please enjoy a fresh overview of the food oil trade market. 

Sunflower

USDA reduced Ukraine’s 2024/25 sunflower harvest forecast by 1 million tons to 12.5 million tons (15.5 million tons last year), marking a 21% decline from the five-year average due to lower yields and reduced sowing areas. By mid-September, Ukraine had harvested 2.975 million tons from 1.5 million hectares, with yields at 1.98 tons/ha.

Sunflower seed prices for 50% oil content have increased to ₴20,500-21,500 per mt as farmers delay sales, awaiting better prices. For seeds with 46% oil content, the minimum price is $420. Sunflower oil and meal prices at ports remained stable at $910-930 and $190-195 per mt, but these prices don’t reflect the actual market situation, as seed costs suggest higher oil prices. India traded sunflower oil at $1,060 per mt this week, and the EU is steadily raising bids for crude sunflower oil.

Global oilseed production is expected to decline by over 3 million tons and reach 687 million tons, with sunflowers dropping by 2 million tons and rapeseed by 1.27 million tons, primarily affecting the EU. 

In Russia, sunflower seed exports from Black Sea ports rose by $5 to $930/t in October, as yields in drought-affected areas remain lower than last year’s levels.

Rapeseed

In Ukraine, only 55% of the usual area was sown with winter rapeseed due to unfavorable weather. As a result, CPT Odessa prices remain firm at $470 per mt. The country’s rapeseed crushing volume is expected to drop from 950k tons in 2023/24 to just 500k tons in 2024/25.

Meanwhile, Russia is set to produce a record 5 million tons of rapeseed in 2024. 

The rapeseed oil price in China gained 5.39% in September, reaching ¥8,895 per mt. Trade tensions between China and Canada could shift canola oil and seed exports to the EU, while Canada’s export potential for canola oil is projected to reach 4.1 million tons in 2024/25. 

India may also ramp up rapeseed and canola oil imports as the price gap between sunflower/soy oils and rapeseed oil narrows.

Palm Oil Market

The EU’s new palm oil regulation, effective from December 30, 2024, could reduce Indonesia’s palm oil exports by 30%. Large operators must comply immediately, while smaller companies have until July 2025. Non-compliance could result in penalties up to 4% of turnover. This move aims to address deforestation, potentially boosting demand for high-oleic sunflower oil (HOSO) and other soft oils.

Palm oil prices remain stable, ranging from ¥3,800 to ¥4,200  per mt in Malaysia and Indonesia. However, with tightening stock levels in these regions, there could be upward pressure on prices. In China, palm oil prices decreased by 2.25% in September, from ¥8,180 to ¥7,996 per mt.

Soybean Market

In the US, 6% of the soybean crop had been harvested by mid-September, exceeding last year’s mark of 4% and the five-year average of 3%. 

Argentina’s soybean sown area for 2024/25 MY is projected to increase by 7.5% and reach 17.7 million hectares, with an expected harvest of 52-53 million tons.

Meanwhile, Chicago soybean oil futures hit a multi-year low of $857 per mt in September. 

China’s soybean oil prices fell slightly, reaching ¥7,740 per mt.

In Ukraine, CPT Odesa port prices for GMO and non-GMO soybeans stand at $370 and $395 per mt, respectively. Concerns persist over the quality of Ukrainian soybeans due to a high proportion of unripe green beans, which may affect oil quality.

General Market Outlook

India’s recent 20 percentage point hike in import duties on edible oils has disrupted the global vegetable oil market. New duty rates are now 27.5% for crude oils (up from 5.5%) and 35.75% for refined oils (up from 13.75%). As a result, USDA revised India’s import forecast from 3.1 to just 1.95 million tons.

Russia’s export duty on sunflower oil will remain at zero in September. The country’s exports of vegetable meals from January to August reached 2.91 million tons, a 7% increase from last year, with sunflower meal accounting for 1.98 million tons. The main buyers were Turkey (688k tons) and Belarus (602k tons). More so, Russia’s soybean meal exports grew by 19% to 651k tons, while rapeseed meal exports doubled to 271k tons, with China and France being key buyers.

That’s all the news for now. I hope you find this information useful and always welcome any questions or feedback. 

Thank you for your attention.