Otherwise, the reduction in demand for oil products and the decrease in processing volumes will continue the downward trend. According to Mikhail Maltsev, Executive Director of the Fat-and-Oil Union, the current adjustment of sunflower prices in Russia, averaging 250-300 rubles per ton, will not solve the main problem of negative profitability of processing.
Maltsev specified that losses of sunflower processors can reach 5 thousand rubles per ton, given the current level of sunflower prices - over 43 thousand rubles per ton with VAT.
“Therefore, in order to overcome this problem, a serious adjustment of sunflower seed prices in accordance with market conditions is necessary. Otherwise, we will face a reduction in demand for oil products, a decrease in processing volumes, and the accumulation of significant stocks, despite sounding absurd,” Maltsev emphasized.