The sunflower market turned down - SovEcon
The sunflower market turned down - SovEcon
Sunflower prices in the European part of Russia decreased by 575 rubles to 28,425 rubles (excluding VAT), follows from SovEcon price monitoring. Pressure on prices was exerted by an increase in supply and a decrease in demand from processors.
The reversal of the sunflower market in February was preceded by a long rise in prices. From November to February, average sunflower prices in the domestic market increased by 39% to 29,025 rubles/t.
The decline in prices began against the backdrop of increased supply from Russian agricultural producers. The growth is due to spring warming and deterioration of storage conditions in farms. As of February 1, stocks in agricultural enterprises, according to official estimates, amounted to a record 2.8 million tons against 2.1 million tons a year earlier.
Demand from processors declined slightly on the back of weakening export prices, which fell by $140 from the beginning of the year to February 22 and reached $1,040/t FOB.
Another factor in the decline in prices was the increase in the export duty on sunflower oil. The March duty was raised to 2,068.1 thousand rubles against the zero duty in October-February. This could further dampen demand from processors.
We expect that sunflower prices will continue to decline in the near future.
