Old crop sunflower prices have traded unchanged to up 15 cents in the past week. New crop was also unchanged to up 15 cents. CBoT traders are mainly focused on South American oilseed production. Last week USDA pegged Brazil’s soybean crop at 108 million metric tons, up from 104 million the prior month. The Brazilian crop seems to be getting larger with each new report. Harvest progress has been good in South America with no weather complications to speak of at this point. This has traders thinking that US soybean exports could struggle into the start of the next marketing year. The large South America soybean supply could continue to weigh on new crop prices moving forward. Next week, USDA will release its March 1 stocks and US 2017 planted acres by crop reports. Some industry members are expecting oil sunflower acres to show a decrease from 2016. Confection sunflower acres are expected to be equal to or slightly higher than last year. Most private firms look for corn acres to decrease from 94 million acres to 90 million this year. Soybeans are expected to increase from 83.4 to 88.5 million acres with wheat acres down to 45.6 million versus 50.2 last year. The next key USDA reports aren’t out until March 31, so traders will be watching the pace of farmers’ sales, Chinese buying interest and US spring weather.
New crop sunflower prices are out at the crush plants with cash and Act of God (AOG) contracts available. Something else to consider is the oil premiums that crush plants pay on sunflower. Sunflower is the only oilseed that pays premiums for oil content above 40%. Considering oil premiums that are offered at the crush plants on oil content above 40% at a rate of 2% price premium for each 1% of oil above 40%; this pushes a contract with 45% oil content gross return 10% higher per cwt.