Ukraine mulling temporarily ban on sunflower seeds exports

Ukraine's economy ministry proposes that a zero quota for exports of sunflower seeds be established from May 15 to September 30, 2021.

That's according to the relevant draft resolution published on the ministry's website on April 20.

The introduction of a temporary licensing regime and quotas for sunflower seeds exports at "zero tonnes" will stabilize prices of this produce in Ukraine, the memo says. According to the State Statistics Service's preliminary data, the gross yield of sunflower seeds of the 2020 harvest is projected at 13.1 million tonnes, which is 13.9% down from the previous year. At the beginning of the new marketing period (September 2020), the availability of raw materials at oilseed processing plants accounted for a mere 36.9% of last year's volumes, while purchase prices in two weeks of September 2020 alone rose by 30%.

Read alsoLibya interested in importing Ukrainian sunflower oil, dairy products – State Food Service"Now, the demand for sunflower seeds at oilseed processing enterprises remains high. As a result of the high competition for raw materials both on the domestic and global markets, prices of sunflower seeds have increased by over 2.1 times since the beginning of the marketing year [MY]. Due to high prices of sunflower seeds on the foreign market, export volumes in September-March of MY 2020/2021 increased by 6.8 times against the corresponding period of MY 2019/2021, to 183,000 tonnes," the document said.

Sunflower oil price hikes stemmed directly from a significant increase in prices of sunflower seeds, which account for 85% of the cost of oil production. According to the State Statistics Service, the average price offered by producers of unrefined sunflower oil increased by 46% by September 2020 and in February 2021 stood at UAH 32,932, or US$1,176, per tonne, (a 78% increase against February 2020). The export price of sunflower oil since September 2020 has skyrocketed by 91%, or more than doubled, from April 2020. As of April 1, 2021, it fluctuated within US$1,520-1,580 per tonne.

Background

On April 19, the Ministry for Development of Economy, Trade and Agriculture and the Ukroliyaprom Association approved the sunflower oil exports ceiling in the current season (September 2020-August 2021) at 5.38 million tonnes, against the previous season's figure at 6.9 million tonnes.