Crushing facilities in Ukraine operate at 50% capacity — Kapshuk

The Ukrainian oil and fat industry has become a world leader over the past 15-20 years, but today oilseeds processing enterprises operate at only 50% of their capacity, the Director of Ukroilprom Association Stepan Kapshuk stated during the inter-ministerial meeting chaired by the Minister for the Development of Economy, Trade and Agriculture of Ukraine Ihor Petrashko.

"There are at least 118 oil extraction plants in Ukraine, their annual processing capacity is 23 mln t, and 50 thou. t per day. If earlier it cost UAH 500 mln, now the amount reaches UAH 750 mln. It seemed that the agrarian earns from it, but it is impossible to buy sunflower, there is no sunflower. The plants are now operating at 50% capacity. But it is expected that the price will rise even more. To top it all, mass export of sunflower has intensified," Stepan Kapshuk stated.

As he noted, rapeseed is no longer available in Ukraine, crushers processed about 200 thou. t and about 1.6-1.7 mln t of rapeseed were exported. As of October 22, the bulk yield of soybean made up 2 mln t of which 300 thousand tons were exported and about 200 thousand tons were processed.

Stepan Kapshuk also reminded that Ukraine imported soybean from Brazil for the first time. In his opinion, it is necessary to accumulate about 500 thou. t of soybeans in the country to cover the domestic market of Ukraine.

Related: Soybean Deficit in Ukraine

"We are losing markets because of high prices. India refuses buying vegetable oil above USD 900 per ton because they have their own duty. This country accounts for 34% of Ukrainian vegetable oils export. In the conditions of tough competition, Ukraine managed to conquer the world market, and the impossibility to procure sunflower disrupts the fulfilment of contracts, even spot ones, no chance for forward ones. We have concluded forward contracts for the supply of 1 mln t of oil, the price difference is about USD 130. As a result, the plants will sustain a USD 130 mln loss," Stepan Kapshuk concluded.

Sunflower harvest as of October 22 reached 11.4 mln t, soybean 2.03 mln t. The crops were 91 and 75% harvested.

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