Ukraine: Enterprises, processing sunflower, will have to partially use their production facilities

According to analysts of IA APK-Inform, the majority of the agrarian market members do not expect the active trade of sunflower seeds and products of their processing until the end of 2017.

Due to the low harvest of sunflower this season, many processing companies will not have to work fully and experts do not exclude such an opportunity that the second half of the 2017/18 marketing year will be marked by a partial stoppage of production at some enterprises. This is stated in the publication by APK-Inform.

Also, the statement says that the authorities of India, which is by far the largest importer of vegetable oil in the world and in Ukraine, have adopted a resolution to increase customs duties on the import of vegetable oils. Such a decision by the Indian authorities had negative consequences for the price policy of sunflower oil, which is exported.

At the same time, experts believe that it will not be possible for India to satisfy the domestic market needs without the import of vegetable oils, and as consequence, the country will have to increase the import volumes of vegetable oils.

These processing enterprises will have to increase the volume of processing of their own raw materials, which will require significant investments in the expansion of production capacities. In addition, it may be necessary to review and optimize logistics processes within the country.

Such changes in the economic climate and requirements for processors may affect the Ukrainian sunflower oil market and lead to changes in prices and competition. However, in general, processors are ready for changes and see them as an opportunity to improve product quality and expand their business.