Ukraine to produce 5.5 mt sunflower oil in MY 2016/17

Ukraine’s sunflower oil industry, which is the global leader, will produce 5.5 mmt of sunflower oil in the 2016/2017 marketing year, Agrarian Minister Taras Kutoviy told the Interfax-Ukraine news agency on Dec. 5. Of this volume, 5.0 mmt of oil will be exported, he said. In MY 2015/16, Ukraine produced 4.85 mmt of sunflower oil, with 4.40 mmt exported. The 2016 harvest was a record 12.9 mmt of sunflower seed, a hefty 15% increase yoy.

Igor Zholonkivskyi: A record 2016/17 marketing year for sunflower oil production falls in line with our expectations, as it merely confirms industry estimates of surging sunflower seed harvests.

We continue to view such developments as positive for Kernel (KER PW), which should benefit from the ample supply of sunflower seed this season, thus reducing costs and improving margins in its bulk oil production segment. We maintain our bullish view on Kernel stock.