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Lower crop, biodiesel boost Black Sea sunoil pricesBy Pavel Polityuk and Robin Paxton KIEV/MOSCOW, Sept 5 (Reuters) — Sunflower oil prices in Ukraine and Russia are set to rise sharply due to high demand from global biodiesel producers and a forecast reduction in the sunseed harvest next year, industry analysts said on Wednesday. Domestic sunoil prices in Ukraine, the world's largest exporter this season, have risen to a record $1,010-$1,040 a tonne ex-works from $800-820 in early June and $620 early March. In Russia, prices have hit 27,000 roubles ($1,051) a tonne and are rising by an average 500-1,000 roubles weekly as buyers contend with record-high prices for the new sunseed crop. «European Union policy aimed at increasing biodiesel production is the main reason for the jump in vegetable oil prices,» said Volodymyr Lapa, an analyst with Ukraine's Agriculture Confederation. «The current high sunoil prices are likely to continue their rally and a new peak could occur in seven to eight months. The harvest is lower, but consumption will increase,» said Lapa, whose confederation unites major food producers and traders. The U.S. Agriculture Department forecast in August a drop in the world sunseed crop to 27.438 million tonnes in 2007 from 30.237 million in 2006. The decrease would be felt most acutely in Russia and Ukraine, it said. The USDA said Russia's sunseed harvest was likely to fall 15 percent to 5.7 million tonnes from 6.7 million in 2006, while Ukraine could harvest 4.0 million against 5.3 million in 2006. Major producers Argentina and China will raise output, while the European Union crop is seen at 4.7 million tonnes this year. «The market is concerned with the real numbers of the sunseed crop this year,» UkrAgroConsult consultancy said. «Consumption of sunoil is going to decrease and be substituted by rapeseed oil for food use. This is caused by the sharp decrease in supply of sunoil due to lower sunseed production in nearly all the main producing countries.» LOWER EXPORTS The 2006/07 season was lucrative for sunoil producers in Ukraine and Russia, with both countries boosting exports to 1.8 million tonnes and 680,000-690,000 tonnes respectively. Exports are set to fall in 2007/08. «Exports from Russia could as much as halve, falling to between 300,000 and 400,000 tonnes,» said Andrei Sizov Sr., president of Russian agricultural analyst group SovEcon. Ukraine, which is likely to produce about 2 million tonnes of sunoil in 2007/08, could export about 1.57 million tonnes, UkrAgroConsult said. Another Ukrainian consultancy, APK-Inform, sees sunoil exports at 1.3 million tonnes in 2007/08. Sunoil producers are also paying higher prices for sunseed from the new crop. SovEcon said new-crop sunseed in Russia were being offered at 11,000-11,500 roubles ($428-$448) a tonne, free on rail North Caucasus. Large buyers, including vegetable oil firm Yug Rusi, were paying upwards of 11,500 roubles, SovEcon said. «Many are prepared to go even higher for large cargoes,» SovEcon said in its latest weekly report. UkrAgroConsult added: «In the 2007/08 season, sunseed market operators will be much more aggressive in their procurements due to lower production and quality.»
Date: 05.09.2007 Comments:Leave your comment
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sunoil market
accurate infos
koumenides anastasios, 14.09.2007 08:11:06