Sunflower prospects rise, competing prices decline
GRACE CITY, N.D. — Sunflower industry officials expect to see more acres than earlier anticipated in central North Dakota and east-central South Dakota — especially now, with delayed planting of small grains and canola.
Kent Johnson, director of crop procurement for SunOpta Inc., in Grace City, N.D., says planting delays from rain and colder-than-normal weather makes farmers in the region shift to later-season crops. Sunflowers can be planted until late June.
The SunOpta elevator is on BNSF’s main track but is not heavily reliant on the railroad.
“Most of what we have to handle is a human product — time-sensitive, it’s going to a finish plant,” Johnson says. “In most cases, I’ll use truck freight in and out of here — more direct and something we can monitor a little better.
“Any type of freight — truck, rail and container — all has been delayed and the cost is dramatically higher than what it was in past years, which has dipped into our overall margins.”
In the past few years, with the higher prices of corn, soybeans and wheat, the competition for acres has taken its toll on U.S. sunflowers.
No instant market
John Sandbakken, executive director of the National Sunflower Association in Bismarck, N.D., says prices have bumped in recent weeks, especially after last year’s acreage reductions and prevent-plant conditions. The U.S. Department of Agriculture’s March intentions report showed acreage below industry expectations, and new-crop prices firmed up after that. The next major crop report affecting sunflower acres specifically will be the June 30 planted acres report.
Sandbakken says this year’s prospects for the crop are buoyed in part by the uncertainties in Ukraine. He says farmers are also waiting on details for how the farm bill programs will affect them. The biggest effect was the good crop in 2012, followed by the reduced acres in 2013. He says the “act of god” clause in contracts for sunflowers help the crop compete.
Johnson says the industry needs to be competitive on price as it rebounds, but a smaller, specialized industry, must grow acres only as fast as it can grow consistent sales.
China is one of the big international wild cards.
“They import some years and can be a huge exporter other years. That’s probably our biggest concern in the confection industry — which way they go,” Johnson says.
The 2014 National Sunflower Association Summer Seminar will be held June 24 to 26 in Deadwood, S.D. Register at www.sunflowernsa.com.