While many other grain commodities have faced numerous struggles this year, sunflower has been fortunate to avoid most of those.
“Good seed demand has allowed sunflower prices to avoid the headwinds some other commodities are currently experiencing,” said John Sandbakken, executive director of the National Sunflower Association, writing in NSA’s weekly newsletter on Sept. 3. “Nearby seed prices at the crush plants were unchanged this week and continue to trade above the 60-day moving average.”
As of Sept. 3, old crop NuSun prices at the Cargill crush plant in Fargo, N.D., were listed at $17.70 per hundredweight for delivery in September and $17.40 for October delivery. At the ADM crush plant in Enderlin, N.D., NuSun prices for delivery in September were $17.90 and $17.30 for delivery in October. November NuSun prices were $17.40 at Fargo and $17.30 at Enderlin.
High oleic sunflower prices at Fargo were $17.90 for delivery in September and $17.60 for October delivery. At Enderlin high oleic prices were $18.25 for September delivery and $17.60 for October. High oleic prices in November were posted at $17.60 at Fargo and Enderlin.
“The market is taking a breath after setting market highs in each of the past four weeks,” he said. “In August, old crop prices gained 75 cents per hundredweight. New crop values remain at market highs set in late August.”
The sunflower crop is in the midst of a critical time for development – mid-August through September. The sunflower growing states have mostly adequate moisture, but crop development remains behind the five-year average normal pace in most areas.
In states reporting crop conditions, the crop is being rated at 78 to 88 percent good-to-excellent condition. According to recent crop progress reports 85 percent of the sunflower crop in North Dakota is in good-to-excellent condition, with 13 percent rated fair and 3 percent poor-to-very poor.
Minnesota is reporting that 78 percent of its sunflower crop is in good-to-excellent condition with 22 percent rated fair.
“This should mean that yields will be above trend assuming normal weather through the rest of this fall and the lack of an early freeze,” Sandbakken said. “Buyers will be anxiously watching crop production prospects before making longer term purchases.”
He pointed out that 2019 U.S. sunflower production is still undetermined and will not be known until this fall. In its first estimate, USDA projected U.S. sunflower production nearly unchanged in 2019-20 at 2.12 billion pounds.
“In October, USDA will provide an updated estimate for oil and non-oil sunflower production. These reports and demand news will set the tone for new crop sunflower price direction in the near term,” Sandbakken said.
He also suggested that producers consider the oil premiums that crush plants pay on sunflower as it is the only oilseed that pays premiums for oil content above 40 percent.
“Considering oil premiums that 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,” he said, adding that the Act of god clause $17.10 contract increases to $18.80 and the cash $17.60 contract moves up to $19.35.