Sunflowers in bloom

Sunflower harvest in the U.S. is progressing, but not at a very rapid clip. Meanwhile the market tries to deal with a somewhat bearish World Agricultural Supply and Demand Estimate from USDA.

John Sandbakken, executive director of the National Sunflower Association, noted in NSA’s weekly newsletter that sunflower harvest in the U.S. is slowly moving along.

“Most states are equal to or trailing the five-year average harvest pace per USDA,” Sandbakken noted. “Wet and below normal cold weather has hampered harvest progress in the largest production area of the Dakotas and Minnesota.”

In North Dakota 68 percent of the sunflower was complete as reported on Nov. 13. That compares to 80 percent last year at this time and 74 percent for the five-year average. Next door in Minnesota, 63 percent of the harvest was complete. That is far behind last year’s pace of 92 percent complete and the five-year average of 90 percent. Sunflower harvest in South Dakota, at just 55 percent complete, is also well behind last year’s pace of 79 percent and the average of 76 percent.

“In the past week, producers harvested an additional 230,000 acres pushing 2018 harvested acres to almost 608,000 acres,” Sandbakken said. “This represents 53 percent of this year’s projected harvested acres and is behind the five-year average. Last year at this time 81 percent of the crop was harvested.”

According to harvest reports, seed quality remains generally very good with oil content almost one point higher this year than in 2017 – 44.3 percent vs 43.4 percent. Test weights are also almost one pound more in 2018 compared to last year – 31.6 vs 30.8.

Sunflower prices at the crush plants ended the week as of Nov. 9 mixed at unchanged to up 5 cents. NuSun prices at the Cargill plant in Fargo, N.D., were listed at $16.70 per hundredweight for delivery in November and $16.80 for delivery in December. Prices at ADM in Enderlin, N.D., were $16.55 for delivery in November and $16.65 for December delivery.

High oleic sunflower prices at Fargo were also $16.50 for December delivery and prices at Enderlin were $16.55 for November delivery and $16.65 for delivery in December.

Besides harvest progress, the market was also dealing with the bearish news delivered by USDA in its November report.

In its report USDA pegged soybean production at a record 4.6 billion bushels, down 90 million bushels, or about 2 percent, from the October forecast, Sandbakken pointed out.

“However, domestic soybean ending stocks came in at 955 million bushels, up 70 million bushels from last month as USDA reduced soybean exports by 160 million bushels on lower sales forecasts to China,” he said.

Sandbakken also noted that the price discovery period is complete for USDA Risk Management Agency (RMA) Harvest Prices for revenue insurance policies for sunflower.

“The harvest price per pound for oil-type sunflowers should be 15.5 cents and confection sunflowers at 21.7 cents,” he said. “The spring prices were 17.5 cents for oils and 23.7 cents for confections. Given the drop between the spring and fall prices producers should contact their local crop insurance agent to see if they are eligible for an indemnity payment due to loss in revenue even if they have reached their proven yield.”

On another point, new crop prices for the 2019 sunflower crop were out at the North Dakota crush plants with cash and Act of God (AOG) contracts available. NuSun prices at both Fargo and Enderlin were $17 cash and $16.50 with an AOG clause. High oleic new crop prices were also listed at $17 cash and $16.50 with an AOG clause.

Sandbakken again pointed out another consideration for producers is 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 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 cwt.

“The AOG $16.50 contract increases to $18.15 and the cash $17 contract moves up to $18.70,” he added.

With the USDA production estimate in the market and harvest wrapping up in the Northern Hemisphere attention now shifts to demand and to South America's crops.