Delays in oil exports may cause shortage of corn elevator capacity

Delays in the export of vegetable oil can slow down the processing of sunflower and the release of elevator capacities necessary for the new corn harvest.

This is reported by Latifundist ndist with reference to “Ukroliyaprom”.

Active harvesting of corn, which requires significant drying and storage capacities, is beginning in Ukraine. At the same time, it is more difficult to store sunflower for a long time in polymer sleeves or temporary storages due to the risk of self-heating and deterioration of quality.

During normal operation, oil extraction plants rhythmically accept sunflower from farmers, which allows to free up stationary elevators and dryers for corn.

However, delays in the shipment of finished oil can disrupt this chain. According to Ukroliyaprom, the capacities of oil extraction plants for storing finished products are designed for only 5-7 days of operation.

If the oil is not exported on time, the tanks fill up, after which the plants are forced to reduce or stop processing, and accordingly – the acceptance of new sunflower.

As a result, farmers may simultaneously face the need to store sunflower for longer with the risk of losing its quality and the lack of free capacity for drying and storing corn.

Ukroliyaprom also emphasized that oil tankers and grain hoppers do not compete with each other, as do specialized terminals for transshipment of these cargoes in ports.

At the same time, both grain and vegetable oil depend on common railway and port infrastructure – in particular, locomotive traction and vessel handling capabilities. It is the distribution of these resources that is currently the subject of discussion between grain producers and the oil and fat industry.

USM previously reported that grain is accumulating in the Black Sea region: this may increase pressure on world prices.