Several of Ukraine’s major vegetable oil production plants have halted operations following Russian attacks, damage to production infrastructure and emergency power outages. According to financial analyst Andriy Shevchyshyn, this will not lead to a shortage of sunflower oil in stores for now, but it could leave farmers without enough buyers for this year’s harvest.
„A one-month pause is unpleasant but manageable; a longer pause is already a major problem“, Shevchyshyn says. According to him, farmers are already facing difficulties transporting grain and securing working capital. If the companies do not resume operations in the coming months, the pressure could spill over into vegetable oil exports and domestic purchase prices for oilseed crops.
Several major producers have been affected
On 12 November, Delta Wilmar Ukraine halted all of its production facilities, including its oil extraction plant in Odesa region. The company produces sunflower oil, margarines, specialty fats and lecithin. Some of its output is intended not only for households but also for industrial food producers. The shutdown is linked to the worsening security situation and ongoing emergency power outages.
The Kernel agricultural holding has also suspended operations at all of its oil extraction plants and halted the purchase of oilseeds. The company produces oil under the „Shedry Dar“, „Stozhar“ and „Chumak“ brands, as well as meal and other sunflower-processing products. Finished products will continue to be shipped from warehouse stocks.
The impact on farmers could deepen
The „Nizhyn Oil Extraction Plant“ in Chernihiv region halted operations on 10 November following an attack by Russian unmanned aerial vehicles. The facility sustained significant damage to its property and production infrastructure. It produces sunflower, soybean and rapeseed oil, meal, lecithin and pellets made from sunflower husks. Before its modernization, its capacity was approximately 140,000 tonnes of oil and 120,000 tonnes of feed meal per year.
Since 13 November, the „Potoki“ plant in Dnipro has also been temporarily shut down. The facility has suspended the purchase and processing of sunflower due to problems with electricity supplies, security concerns and the need for restoration work following previous shelling. Its products include crude sunflower oil, protein concentrate, phosphatide concentrate and pellets. No date for the resumption of operations has yet been given.
Against this backdrop, sunflower purchase prices in Ukraine have fallen to 15,000-16,000 hryvnias per tonne, while tariffs are making sales to Turkey and Bulgaria more difficult. If the processing halt continues, farmers will have fewer opportunities to market their produce, while an immediate shortage of cooking oil on the domestic market is not expected.
Sources: obozrevatel.com, latifundist.com, agroportal.ua