Ukraine Has Good Prospects for Increasing of Sunflower Oil Exports to China

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The FINANCIAL — For several recent years, China demonstrated the upward trend in the consumption and import rates of sunflower oil, which opens new prospects for increasing of the export volumes of the Ukrainian product to the country.

The reporting prospects become even more apparent, taking into account the growth of sunflower oil production in Ukraine in the current year, and the forecasts of decline of the imports to India, explained the speaker.

At the same time, Ukraine continues keeping the leadership position in the supply of sunflower oil to China, but in 2017 its share in the market segment decreased to 63%, as opposed to 75% in the previous year.

The active expansion of Russian sunflower oil on the Chinese market became the major reason for such dynamics, because the production volumes almost doubled for 10 recent years. In the same period, the growth of exports was even more significant — the foreign supplies of sunflower oil from Russia increased in 7 times, and exceeded the level of 2 mln tonnes, which pushed down the Ukrainian positions on the key export markets, including the Chinese market.

The Russian oil demonstrates the lower prices compared with the Ukrainian oil. Thus, the spread between FOB prices of both products totals nearly 20 USD/t in favour of sunflower oil of Russian origin.

Nevertheless, Ukrainian sunflower oil has a number of advantages over its Russian analogue. First of all, the product is available on the Chinese market for a long time, it managed to keep the strong positions and gain the confidence of local consumers. Also, the qualitative features of the Ukrainian product are higher and better meet the requirements of the Chinese party. Thus, the share of Ukrainian sunflower oil in the general structure of the Chinese imports will remain at more than 50%, and in the current season Ukraine will face some growth of the supplies, due to the significant demand for the product on the Chinese market, the expert noted.

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