Rain Threatens Ukraine’s Sunflowers as Oil World Cuts Forecast

Global sunflower seed production may be less than expected as wet weather delays the harvest in Ukraine and Russia and leaves crops at risk of damage, Hamburg-based Oil World said.

World production of sunflower seed may be 39 million metric tons or less in the 2013-14 season, below a previous forecast for a record 40.2 million tons, the researcher said in an e-mailed report today. The harvest in Ukraine, the world’s top producer, is progressing at the slowest pace in at least four years. Only 2 percent of crops were collected in Russia’s Volga valley, the main growing region, compared with 33 percent at the same time last year. Russia is the second-biggest grower.

“The situation could become critical as there is the risk of more or less sizable crop damage in Russia and Ukraine if too wet conditions further delay harvesting,” Oil World said. “The unfavorable moist conditions have weakened the plants and there is the risk that the stems break under the weight of the top carrying the seed.”

Prices of sunflower oil from the Black Sea region climbed as high as $870 a ton as of Sept. 26, compared with $850 a ton in mid-September, Oil World said. Lack of seed-drying facilities delayed crushing in the region, so supplies of sunflower oil and meal have tightened at export locations, it said.

Oil World cut its forecast for Spain’s sunflower seed production to 880,000 tons from a projection of 1.03 million tons after crops in Andalucia were damaged by birds. Total output in the European Union may be 8.4 million tons, 200,000 tons less than estimated two weeks ago, while “sharply” higher than last year’s harvest.

Argentina

Production prospects have “deteriorated significantly” in Argentina, where farmers in northern areas may plant 250,000 to 300,000 fewer hectares than originally intended because of dry weather, Oil World said. National output may be 3.2 million tons, 300,000 tons less than previously expected.

Rapeseed and canola production worldwide may be as much as 1.5 million tons larger than a previous projection of 65 million tons because of improving prospects in Canada, Oil World said. The researcher also raised its estimate for production in the EU to 20.9 million tons in the 2013-14 season as higher output in eastern Europe made up for a smaller harvest in France.

To contact the reporter on this story: Whitney McFerron in London at wmcferron1@bloomberg.net

To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net

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