Sunflower prices are stronger than normal for this time of the year at the crush plants, as a reduction in harvested acres and tight seed stocks have crush plants searching for seed supplies.

Since harvest began, nearby prices have added $1 to $2.25 per cwt and are trading in a range of $31.75 to $32.50. In the last marketing year, harvest pressure and heavy producer selling caused prices to fall, with nearby sunflower prices trading from $18.65 to $19.15 at the crush plants. That will likely not be the case this marketing year, as seed supplies are tighter than last year at this time. It is possible that the market low has already been established and prices will remain relatively firm for the foreseeable future.

Upward movement

After being somewhat quiet, bird food prices have also had some upward movement of $1 per cwt in some locations. Warmer-than-normal temperatures with little snow on the U.S. East Coast, the primary market for bird food, has slowed demand. Bird food prices could rally if tougher winter conditions set in.

In the global vegetable oil market, palm oil prices are expected to continue an upward trend, as production levels are significantly reduced from 2021. Oil demand is robust, and this has propped up soybean oil values on the Chicago Board of Trade and is good news for sunflower growers. Sun oil values are closely tied to soy oil values, which could result in upward price momentum in seed prices at crush plants.

Looking ahead to 2022 new crop, NuSun and high-oleic sunflower prices are expected to be aggressive the next few months as the industry tries to secure 2022 production after 2021’s smaller crop. The potential of tight ending seed stocks by the end of September has oil crushers offering attractive 2022 new-crop contracts, which have increased since they first rolled out last fall.

When looking at new-crop sunflower prices and crop budgets, producers need to consider the value of oil premiums paid on oil sunflowers. Oil premiums are offered at the crush plants on oil content above 40% at a rate of 2% price premium for each 1% of oil above 40%. For example, 45% oil content results in a 10% price premium, which pushes gross returns from oil sunflower even higher.

Once again, 2022 will be another challenging year in terms of marketing commodities. Margins will be tighter, so producers are going to have to buckle down and watch their marketing in the year ahead. They will also have to sharpen a pencil when it comes to figuring the bottom line, as crops that were profitable last year may not be in 2022.

In the months ahead, price direction will be determined mainly by export demand news and South American oilseed production prospects. The U.S. dollar continues to stay strong against other currencies, which could lead to a slowdown in exports as importers look for cheaper sources of product. Weather in Argentina and Brazil was favorable as of late December. To keep up with price movement and find seed buyers, visit the National Sunflower Association.

Sandbakken is the executive director of the National Sunflower Association.