The market forecast for sunflowers calls for lots of sunshine. Prices are up and so are acreage expectations.
American growers plan to increase plantings by 47 percent, according to the United States Department of Agriculture March 31 seeding intentions report.
The projected 2.75 million acres will be the biggest crop of sunflowers the country has seen since 1999.
A March seeding intentions report issued by Agriculture Canada was less bullish, calling for a 15 percent increase in the Canadian crop, to 247,000 acres.
The surge in acreage is being driven by an acute shortage of sunflower seed due to a disastrous 2004 crop.
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To appease oil and confection customers, U.S. processors and dealers have imported supplies of oil and seed and prorated sales into the new crop year. But in some cases they have simply lost markets to competing products due to a lack of supply.
“They drove the price up to try and find all the sunflower seed they could find,” said Mel Reimer, executive director of the National Sunflower Association of Canada.
Those high prices are still there “because the markets are very demanding and there is no product.”
Confectionary-type seeds used in snack foods are selling for 25-35 cents per pound depending on the size and quality of the product. Oil-type seeds are fetching 20-25 cents per lb.
“Prices are normally about 10 cents less than that, so it’s quite a bit higher,” said Reimer.
Eighty percent of the 2005 American crop will be seeded to oil varieties, according to the USDA report. About 85 percent of the Canadian crop is typically seeded to confectionary varieties because there are no oil processing facilities in this country.
That accounts for the difference in acreage expectations between the two countries.
The U.S. sunflower crop got a big boost from the recent soybean market rally, which raised the value of all vegetable oils. Trans fat labelling requirements have also spurred acreage by shifting snack manufacturers to naturally stable oils derived from crops such as sunflower and high-oleic, low-linolenic canola.
Sales prospects for confectionary types are not as volcanic, but they are still strong due to the tight supply.
Canadian producers harvested only 35 percent of what they expected to grow in 2004, almost none of which was a quality product.
“Basically it was a lost year,” said Reimer.
Still stinging from a year in which a late-seeded crop was hit by frost and a wet harvest, growers are reluctant to roll the dice on sunflowers again, especially when competing crops like soybean and canola appear on the rise.
“They’re not about to jump into something because the price is up, but they are sniffing around,” said Reimer.
The allure of sunflower is enhanced by its competitive cost of production compared to other broadleaf crops.
According to an analysis by Manitoba Agriculture, the total operating and fixed costs of growing sunflowers in Manitoba, a province that is home to 80 percent of the Canadian sunflower crop, is expected to be below that of canola and navy beans but slightly higher than soybeans.
