Ukrainian Farmers May Plant More Oilseeds According To Market Sources

March 24, 2023

3 mins read

Ukrainian Farmers May Plant More Oilseeds

 

Turning to spring plantings Mintec has learnt that farmer margins for planting corn are near zero, this is likely to mean that farmers plant more oilseeds such as sunflower as margins for doing so are still currently positive. According to Mintec calculations, if the calculated planting levels Mintec is estimating go ahead, 13.5 million metric tonnes of sunflower seed may be produced from Ukraine come harvest in November and December. This would be an increase of circa 3 million metric tonnes from volumes produced in the 2022 planting season which at first glance seems like it may increase supplies. However, carry into the 2022/23 season was circa 4.4 million metric tonnes which gave a total supply of around 15 million metric tonnes, this is contrasted by expected carry into the coming harvest to be between 500,000 and 1 million metric tonnes which may mean that despite the estimated increases in production overall supply is at similar or even lower levels compared to last season. In addition, due to changes in plantings Ukraine may be ‘forced’ to consume more sunflower seed domestically as the lower planting of corn is likely to curtail production of the important feedstuff. 

 

Source: Mintec, USDA, Market Players - Calculations of production and/or total supply have been estimated by Mintec using yield figures/planting projections/burn rate and seasonal trends

 

Source: Mintec, USDA, Market Players - Calculations of production and/or total supply have been estimated by Mintec using yield figures/planting projections/burn rate and seasonal trends.

A Black Sea trader commented to Mintecit’s very likely that sunflower seed plantings increase at the expense of corn acres as I don’t think there are many farmers who want to make zero margins. However, supply isn’t likely to increase because market players are forgetting the substantial carry we had in the season prior. I still think that the grain corridor is as ever a wild card factor and although it appears to be extended this time that does not mean it happens again.”

 

Kyle Holland
Kyle Holland

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