Sunflower Squeeze: Why Bulgaria’s Crushers Are Grinding to a Halt
In a year plagued by scorching heatwaves, poor seed quality, and fierce competition for dwindling sunflower supplies, Bulgaria’s crushing industry is teetering on the edge. Preslav Raykov, a Bulgarian vegetable oil and commodity trader, reveals how factories are running at half capacity, farmers are hoarding crops, and major processors are pivoting to survive a brutal market squeeze. With russian sunflower oil flooding global markets and domestic production faltering, the future of Bulgaria’s sunflower sector hangs in the balance.
Latifundist.com: Are the Bulgarian factories really operating at half capacity, and what are the reasons for it?
Preslav Raykov: Since autumn 2024 — about five or six months ago — some of the largest crushers have stopped operations, at least partially. They’ve halted crushing lines, especially those dedicated solely to sunflower seeds. The season was already tight, with lower-than-expected crop yields due to bad weather. The final harvest estimates in September were revised downward, confirming a smaller supply.
More importantly, seed quality this year was terrible. In some regions, oil content barely reached 40%, often as low as 37–38%.
Latifundist.com: Is that also because of the weather?
Preslav Raykov: Yes, mainly due to the heatwave in the final six weeks before harvest. The season started well — planted acreage was large, and initial expectations were excellent. Many farmers even began selling forward contracts early, as early as January, for August–September deliveries. I was also booking new crop contracts at that time.
Everything seemed fine until early June 2024, when extreme heat hit Romania and its main growing regions around (Buzău, Constanța) and also Bulgaria (Dobrudja), the key sunflower-growing regions. This heatwave devastated the crops, preventing them from developing properly. As a result, oil content dropped, and there was a high percentage of defective seeds also.
This led to two problems: a lower total supply and the need for more seeds to produce the same amount of oil. The result was a disastrous year for Bulgarian sunflower production.
Latifundist.com: What does this mean for Bulgaria’s crushing industry?
Preslav Raykov: The crushing industry in Bulgaria has an annual processing capacity of around 4 million tons, split between oil production and de-hulling. However, last season, Bulgaria only produced 1.5–1.6 million tons of sunflower seeds. Accounting with the carry-overs also from last season, that meant the industry needed to import around 3.5 million tons to keep operations running in full capacity, a task which was more than challenging.
Latifundist.com: How did this impact contracts and pricing?
Preslav Raykov: When the season started, many farmers defaulted on new contracts simply because they couldn’t deliver and couldn't produce such volumes as they contracted back in the year. Even if they wanted to, they physically didn’t have the seeds from the harvest. I personally experienced defaults on contracts from a lot of suppliers in Romania. At the same time, prices spiked rapidly, and many farmers and traders refused to deliver at previously agreed rates.
This caused even more price volatility. Bulgarian farmers noticed the increasing prices and decided to hold onto their stock instead of selling immediately after the crop. Active trading lasted from September to November, but since December, most farmers have been holding back, waiting for better market conditions.
Latifundist.com: How have big major crushers of Bulgaria responded?
Preslav Raykov: Meanwhile, one of the major crushers halted partly its operations. Their crushing facilities in Eastern Bulgaria stopped processing sunflower seeds. However, they continued purchasing and stockpiling sunflower seeds, including some I sourced from Moldova, Romania, Croatia, and Serbia. Croatia and Serbia had excellent crops this season, so I was able to import 10,000–15,000 tons via barges through Silistra (Bulgaria).
From the outside, the major crusher’s facilities appeared operational — long truck lines formed at the plant. But in reality, their crushing lines weren’t running because processing margins were negative. The crude sunflower oil market was under heavy pressure from large Ukrainian and russian sellers, who dominated traditional Bulgarian export markets such as Africa and Egypt.
Latifundist.com: What is the long-term outlook for Bulgarian crushers?
Preslav Raykov: Because of these negative margins, big crushers began considering diversification of operations. The Bulgarian crushing industry is heavily focused on sunflower seeds — too much so. Banks over-financed this sector, leading to a surge in sunflower-specific facilities over the past decade. Now, there isn’t enough domestic supply to sustain them.
To stay competitive, crushers are beginning to shift toward multi-crushing operations, similar to Turkish processors. This means adding capacity to process rapeseed, soybeans, and canola. All big crushers have already started making these changes, which is why operations slowed down.
Latifundist.com: Have there been any notable changes in sourcing strategies?
Preslav Raykov: For example, since November–December, some crushers have started importing Canadian canola. Currently, a panamax vessel is unloading Canadian canola in Varna, with three more shipments en route. This coincided with China imposing a ban on Canadian canola imports, leaving Canada with surplus supply and making it available at competitive prices.
Rapeseed was also in short supply this season in Romania, Bulgaria, and Ukraine, so crushers looking to diversify faced additional sourcing challenges. This situation led more farmers to plant rapeseed for the upcoming season, anticipating higher demand.
Latifundist.com: What segments of the industry remained profitable?
Preslav Raykov: The only part of the Bulgarian crushing sector that remained somewhat profitable was refining and bottling for retail distribution, which was able to absorb to some extent the sunseed pricing increase and to pass it to the consumer side. The de-hulling industry — processing seeds for export — also remained strong, with demand for sunseed feedstock close to 1 million tons per year. These segments helped balance margins for some companies, but those reliant solely on crude oil production had to either stop or severely reduce operations and look for diversification.
Latifundist.com: What are the expectations for the industry moving forward?
Preslav Raykov: Looking ahead, the industry is in transition. The biggest crushers are resuming operations, but are extensively looking to focus on rapeseed, canola and soybeans, so they can balance with the crushing of sunflower seeds. They aim to gradually become multi-crush facilities. However, this shift won’t be immediate — it will take time to develop full diversification and market channels.
Meanwhile, Turkish crushers have been aggressively purchasing sunflower seeds from Romania, Bulgaria, and Ukraine, offering high prices. Some Bulgarian processors, instead of crushing their stockpiled seeds, sold them to Turkish buyers, as the margins made more sense. Several shipments from Varna and Burgas have already been sold to Turkey.
Overall, 2025 will be a transitional year. The Bulgarian crushing sector is overbuilt, and many smaller, less efficient operations may not survive. The industry will likely consolidate, with major players acquiring smaller facilities. This is similar to what’s happening in Ukraine, where supply shortages are forcing consolidation.
Latifundist.com: How does the situation in Ukraine impact Bulgaria?
Preslav Raykov: Ukraine itself is facing a tight market. Big players are keeping sunflower seeds within the country, offering competitive prices that make exporting unviable. Although there are no official export restrictions, logistics issues at the Moldovan and Romanian borders caused delays, though those have mostly been resolved.
At the same time, large volumes of Ukrainian crude oil continue to flow into Bulgaria, as it remains a cost-effective option for local refiners with bottling operations to balance the production margins and stay in the game. However, crushers focused solely on crude oil exports struggled, as Ukrainian and russian sellers dominated the global markets.
Latifundist.com: What is the key takeaway for Bulgaria’s sunflower industry?
Preslav Raykov: In the long run, Bulgaria's sunflower crushing industry must adapt. Over-investment has led to an unsustainable situation, and diversification is now essential for survival.
Latifundist.com: You were all competing for the same sunflower seed cargos?
Preslav Raykov: We were all competing for the same sunflower seed cargos. Everyone knew every single seed on the market. It was no joke. The competition was intense and supply is tight, taking into consideration the changed import regime for the Turkish buyers, which are now capable of providing way more competitive prices on local FOB markets in Bulgaria, Romania, Moldova and Ukraine.
Latifundist.com: Have there been a lot of Moldovan sunflower seeds entering Bulgaria recently?
Preslav Raykov: Yes, a large portion of Moldovan sunflower seeds, which were originally Ukrainian (since Moldova lacks the production capacity), entered Bulgaria over the past three months. I was actively buying from Džulești to Silistra, but now the market has tightened.
Latifundist.com: Even if the crop is good this year, will Bulgaria still face a deficit?
Preslav Raykov: Even if we assume favourable weather conditions this year, with Bulgaria producing around 2.2–2.5 million tons and Romania reaching a maximum of 2.83 million tons, Bulgaria will still face a significant deficit in sunflower seeds of around 2 million tons at least.
Latifundist.com: Maybe, farmers have increased their rapeseed acreage?
Preslav Raykov: Yes, they did. The area for autumn crops expanded due to strong demand. However, the sunflower area will likely remain the same or slightly increase. Many large farmers told me that for the past three seasons, poor weather, low prices, and weak margins have made sunflower cultivation unprofitable. They said, "If this year is the same, we will stop growing sunflowers — it makes no sense if the crop burns out in four weeks due to heat waves." Some even believe Bulgaria's climate is shifting, making sunflower cultivation increasingly difficult.
Latifundist.com: How was the crop in Romania?
Preslav Raykov: In western Romania, near the Carpathian Mountains, the crop was excellent. I bought seeds there with an oil content of 45-46%. However, in Romania’s primary sunflower-growing regions — Buzău, the Moldova border, and near Bulgaria — the situation was disastrous. The government issued force majeure notices, allowing farmers to exit contracts because they simply couldn't deliver. They wanted to, but their crops had burned.
Latifundist.com: What does this mean for the Bulgarian sunflower processing industry?
Preslav Raykov: The Bulgarian industry is heavily invested in sunflower crushing, and now they realize they need to diversify. Within two to three years, major crushers — there are only three or four — will likely switch to the Turkish multi-crush model.
Latifundist.com: How is the war in Ukraine affecting the market?
Preslav Raykov: Meanwhile, developments in the war in Ukraine could cool the crude oil market. russian crude is entering markets like India, China, and Africa at discounted prices, impacting the entire sector. If crude oil prices fall further, crushers will be in an even worse position.
Latifundist.com: What about the relationship between farmers and the market?
Preslav Raykov: The disconnect between farmers and the market is growing. Farmers say, "I want $700 per ton for my sunflower seeds." But the end market doesn’t support that price. Processors operate at a loss and cannot pass these costs on to buyers. Farmers refuse to adjust, opting instead to store their seeds in silos and wait for better prices. This market adjustment process is slow — convincing farmers takes months. They often believe traders are trying to cheat them, unaware of the market dynamics.
Five or six years ago, after the harvest (September-October), all sunflower seeds were sold to processing facilities by January. Farmers didn’t hold stock for months, waiting for better prices. Now, they see themselves as traders, speculators, and hedgers, which destabilizes the supply chain.
Latifundist.com: Do you see the same situation in Ukraine?
Preslav Raykov: Yes, the same situation is happening in Ukraine, as my colleagues confirm. We’ll have to monitor these developments closely, especially given how russian flows continue to disrupt pricing. Large quantities of russian crude oil are returning to the market, traded by multinational companies, and affecting prices in key destinations like China, India, and Africa.
I hope the Bulgarian industry diversifies soon, adopting a multi-crush model to reduce reliance on a single oilseed.
Sofiia Yaroshenko, Latifundist.com
