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Sunflower market slows ahead of holiday season

by WOOWinvest
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Sunflower market slows ahead of holiday season

Like most other commodity markets, the sunflower market was slowing down as the Christmas and New Year holiday season approached.

“Nearby high-oleic prices were unchanged to up 40 cents with NuSun unchanged at the crush plants this week. 2023 new crop was unchanged,” commented John Sandbakken, executive director of the National Sunflower Association, writing in the Dec. 19 National Sunflower Association newsletter. “NuSun cash is $26.25-$26.35 and $25.85 Act of God (AOG). High-oleics are $27.35-$27.50 cash and $26.85-$27.00 AOG.”

If or Dec. 19, NuSun cash was listed at $24.40 per hundredweight at ADM in Enderlin, ND, for delivery in December and $24.65 for delivery in January. NuSun cash prices at Cargill in West Fargo, ND, were posted at $24 for delivery in December and $24.25 for delivery in January.

ADM in Enderlin also posted a 2023 new crop cash contract of $26.35, as well as a contract with an AOG (Act of God) clause at $25.85. Cargill in West Fargo was offering a 2023 new crop contract of $26.25

Nearby high-oleic sunflowers at both Enderlin and West Fargo were listed at $25.90 for delivery in December, and both offered $26.15 for delivery in January.

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Cargill in West Fargo offered a new crop cash contract of $27.50, as well as a contract with an AOG of $27. ADM in Enderlin’s new crop contracts were listed at $27.35 cash and $26.85 with an AOG.

Sandbakken also pointed out that producers should also consider the oil premiums that crush plants pay on sunflower.

“Sunflower is the only oilseed that pays premiums for oil content above 40 percent,” he said. “Considering oil premiums are offered at the crush plants on oil content above 40 percent at a rate of 2 percent price premium for each 1 percent of oil above 40 percent, this pushes a contract with 45 percent oil content gross return 10 percent higher per hundredweight . The AOG $25.85 contract increases to $28.45, and the cash $27.50 contract moves up to $30.25.”

Looking ahead, Sandbakken pointed out there are several things which will garner a lot of attention from the market.

“In the near-term, the latest headlines from Ukraine, the stronger dollar, demand news and La Niña weather conditions in South America will all be attentively watched by Chicago Board of Trade traders,” he said. “They are also gearing up for USDA’s annual crop production report that will be released in early January.”

Producers and traders can expect to see numbers regarding yield, acreage, and production adjustments for most crops included in the annual crop production report release.

“USDA made very few changes to supply and demand in its December report,” he said. “Sunflower yield, acreage, and production will be updated from the October estimates. With the holiday season upon us, trading will probably be somewhat quiet and may trade sideways until after the holidays.”

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