The last week of January saw a lot of volatility on the Chicago Board of Trade (CBoT), and as a result, sunflower prices saw a slight price correction.
“This week the CBoT featured plenty of price volatility,” noted John Sandbakken, executive director of the National Sunflower Association, writing in the Feb. 1 NSA newsletter. “Large Chinese purchases along with a sluggish start to this season’s South American oilseed harvest provided ample temptation for technical buying.”
Sandbakken explained that the 2021 soybean harvest is underway in South America, but that the crop has been impacted by severely dry conditions, although much of the region has received some good moisture during the last month
“Soybean production in Argentina has been slightly trimmed from earlier estimates due to hot, dry weather experienced earlier in the season,” he said. “In Brazil, most analysts are still expecting a bin-busting soybean crop of around 4.850 billion bushels, even despite some delays prompted by uncooperative weather throughout the 2020/21 season.”
Other commodities, including soybeans, corn and wheat, all have seen slight price corrections, but prices overall remain quite high, historically speaking. The same is true for sunflower.
“On the downside, grains are sitting on historically large net long positions, which can leave prices vulnerable when those positions get liquidated if speculators get skittish,” Sandbakken explained.
“In the sunflower market, nearby NuSun prices ended the week (ending Jan. 29) mixed at down 10 cents to up 40 cents,” he said. “Nearby high-oleic was unchanged to up 40 cents (and) 2021 new crop prices for NuSun and high-oleic sunflower were up 10 to 20 cents.”
As of Feb. 1, NuSun prices were listed at $19.70 per hundredweight for delivery in February and $19.75 for delivery in March at the Cargill crush plant in West Fargo, N.D., and $19.60 at the ADM crush plant in Enderlin, N.D. February delivery price was $19.60 and the March delivery price was $19.85.
Sandbakken also noted that new crop 2021 NuSun sunflower prices are out at both the Cargill and ADM plants. At the Enderlin plant, 2021 new crop NuSun prices were listed at $20.05 cash and $19.55 with an Act of God (AOG) clause. At West Fargo the new crop NuSun price was $20 cash and $19.70 with an AOG.
Prices for high-oleic sunflower was $19.80 per hundredweight for delivery in February and $19.85 for delivery in March at Cargill in West Fargo. Prices at ADM in Enderlin were $19.60 for February delivery and $19.85 for delivery in March.
High-oleic 2021 new crop contracts at Enderlin were listed at $20.30 cash and $19.80 with an AOG. At West Fargo, new crop high oleic contracts were listed at $20.25 cash and $19.95 with an AOG.
On Feb. 1, Sandbakken noted that the USDA Risk Management Agency (RMA) will begin the discovery process in determining 2021 crop insurance price elections for sunflower.
“Producers have the option of choosing Yield Protection, Revenue Protection, and Revenue Protection with the Harvest Price Exclusion,” he said. “All three policies have the same price election.”
To follow the direction for sunflower price elections, Sandbakken suggested that producers watch the 2021 CBoT December soy oil contract during the month of February. Final price elections will be announced in early March.