Seed Market Outlook 15.01.24

Flaxseed

The market continues to hold steady, but demand in Europe is sluggish, contributing to the stabilisation of current market levels. The prevailing consensus suggests that raw material prices will likely remain at these levels until the arrival of the new season's crop, with the hope that prices will decrease. The recommendation is to secure volumes up to Q3 in anticipation of a potential decline in prices with the new crop.

Certain regions have not completed harvesting due to earlier wet weather in the year. Despite this late stage, the cold weather, particularly the occurrence of snow, is expected to help recover some of the yields.

Sunflower

The sunflower seed market maintains its stability. Sunflower oil stands out as the most competitively priced vegetable oil in the market, prompting importers to shift away from other competing oils. The European Union has seen a notable surge in its sunflower oil import demands, driven by substantial year-on-year decreases in sunflower seed crushing and heightened domestic requirements as a substitute for olive oil.

Ukraine's sunflower seed exports remain limited due to widespread import bans, with the domestic industry utilising the majority of raw material for crushing. Additionally, farmers are holding on to their raw material, anticipating upward price movements in light of the aforementioned factors.

Millet

As we enter 2024, the millet market shows little significant change. Prices have sustained relative stability at their present levels. While short-term positions offer some favourable deals, contracts with longer durations carry a slight premium. In comparison to European material, the US market remains notably more expensive.

Poppy

Historically, the Czech Republic has maintained relative stability; however, in recent seasons, the harvest has become more challenging to predict. Factors such as fluctuations in crop yields, farmers opting for more lucrative crops over poppy seeds, discrepancies in crop estimates, and the delicate balance of supply versus demand have all contributed to elevated prices and an unpredictable market trajectory. Unfortunately, the other origins tend to follow suit as the market rises or experiences strong domestic demand, making it challenging to allocate any surplus raw material. Once again, prices heading into the new year have surged to unprecedented highs, with the prevailing expectation being a continued upward trend as the season progresses.

Pumpkin

Shine skin raw material prices are showing signs of strengthening as the season progresses, with stocks gradually depleting. Traders are now required to re-enter the market to fulfil contracted volumes and replenish their stocks. In a parallel scenario with GWS, raw material supplies are diminishing, but a decrease in demand has brought some stability to the market. The primary factor contributing to overall delays and heightened prices is the sharp increase in freight rates.

Sesame

Globally, the Sesame market presents a mosaic of diverse trade dynamics and evolving trends, each with its unique challenges. One significant challenge is the impact of global events on trade routes, as exemplified by the Red Sea crisis, which has necessitated a redirection of shipping routes. This not only prolongs transit times but also increases overall costs, impacting the efficiency of the supply chain. Traders had anticipated a surge in demand before the holiday in India, however, the delayed arrival of winter temperatures there disrupted the supply chain and significantly contributed to the decline in prices. With temperatures now dropping in India, market players anticipate a revival in buying interest in the coming weeks.

As a result of heightened freight costs due to attacks on cargo ships in the Red Sea, export prices are higher than those before the turn of the year, despite domestic market price declines. Additionally, traders are eagerly awaiting the upcoming Korean tender, expected to be announced in the last week of January, with an estimated volume of 9,000-10,000 metric tons. Amid these intricacies, exporters must stay vigilant, as there is potential for a minor increase in white sesame on the horizon.

In conclusion, the current Sesame market is a complex and interconnected web. This comprehensive overview not only elucidates the present state of the market but also provides insights into the future trajectory of global Sesame trade, underscoring the need for adaptive strategies and international cooperation.