Sunflower Oil Prices Explained

As you can see sunflower oil prices are fluctuating. But why is that? And is there a way to predict the price of sunflower oil?

Why are sunflower oil prices fluctuating?

Sunflower oil ranks fifth in production among edible vegetable oils.

Since 2022, the international market saw its price volatility mainly because of the ongoing war between Ukraine and Russia but several factors also play into its surging price. Here are some:

1. Russia-Ukraine War

Russia and Ukraine are the top sunflower oil producers in the world. For 10 years, Ukraine exported 45%-55% of sunflower oil globally, and Russia had a share of 15%-20% of the production until 2022.

The current war between the two countries is affecting the global vegetable oil market. Sunflower oil prices skyrocketed more than 40% since the day of the invasion which causes other vegetable oil prices to soar.

Experts believe that this price trend will continue for the next two years or even longer depending on the two countries’ war agreement.

2. Climate Change

Extreme weather conditions such as heat waves, heavy downpours, tropical cyclones, and floods all directly have a hand in sunflower oil production which ultimately controls its price.

Ukraine’s summer drought in 2021 affected 94% of its sunflower seed production reducing their optimal capacity in the international market.

3. Competition from Other Vegetable Oils

Although 2/3 of oil production accounts for sunflower oil, its price is still vulnerable to other vegetable oils. 

Soybean oil, canola oil, and palm oil are top competitors of sunflower oil in the market. Price changes in any of these oils can impact sunflower oil demand and price.

4. Biofuels

As part of sustainable development goals, some countries are pushing biofuels as a substitute for fossil fuels. 

According to Rabobank, 15% of vegetable oil demand comes from biofuel however the shortage of sunflower oil production led to a tighter need to fill in the gap.

This created a domino effect on other vegetable oils and lastly sunflower oil.

Which variables impact the price of sunflower oil?

• Consumer Preferences and Trends
• Weather Conditions
• Global Supply and Demand
• Exchange Rates
• Government Policies
• Competition from other Vegetable Oils

Where does sunflower oil come from?

Sunflower oil is extracted from sunflower seeds.

Historical records show that sunflowers originated from the South American culture, preferably the Mayans. They considered it a primary source of food. The Mayans believed it has some medicinal properties and was used as a snake bite remedy.

In the 16th century, it was introduced in Europe. Presently, the top 5 sunflower oil-producing countries are Ukraine, Russia, Argentina, Turkey, and France. The United States is also a significant sunflower oil producer. In 2021, its sunflower oil production reached 417 million pounds.

When is the sunflower oil season?

Sunflower is produced throughout the year as their seeds can be harvested and processed all year round. However, it’s worth noting that sunflower oil peak production varies according to the country’s region and climate.

Ukraine and Russia’s cultivation and production are from September to October. The US and Argentina’s peak seasons typically vary from July to August.

Overall, sunflower oil’s production efficiency depends on its country’s economic and weather conditions and global demand.