Source: Ukragroconsult (Ukraine)
Sunflower oil prices falling trends are evident as futures dropped to $1,515 per tonne. Moreover, this retreat comes from three-year highs reached on February 6, as increased supplies from South America and weaker seasonal demand eased the previously tight balance in the global vegetable oil market.
Sunflower Oil Prices Falling: Supply Factors and Competition
Supplies from Argentina are accelerating. Furthermore, Bulgarian processors purchased about 400,000 tons of sunflower seeds at a competitive price for delivery in March. Meanwhile, a record soybean harvest in Brazil has reduced offers for local soybean oil, expanding the choice of cheaper substitutes.
At the same time, palm oil futures have fallen. Consequently, this maintains palm oil’s position as the cheapest option for large buyers such as India and intensifies competition for market share.
Demand Decline and Seasonal Factors
Demand also declined as the Lunar New Year holidays reduced purchases in Asia. Additionally, Malaysian palm oil exports in the first half of February fell by 11% to 15%. Therefore, with the approaching Ramadan period, imports from the Middle East will likely reduce further.
