Kernel Holding, Delta Wilmar and Potoky suspended operations in Ukraine after massive Russian drone attacks. The interruption casts doubt on the USDA projection that 5.0 million tonnes of sunflower oil will be exported in 2026/27.
Kernel Holding, Ukraine's largest sunflower oil producer and exporter, suspended operations at its eight extraction plants following massive Russian drone attacks on agro-industrial facilities that damaged production buildings, equipment and storage tanks. Delta Wilmar and Potoky, other Ukrainian oilseed processing companies, followed suit and also halted their activities.
The escalation came after Ukraine attacked one of Russia's main Baltic ports this week. The Kremlin's response was swift, launching a swarm of drones against agro-industrial companies in general and oilseed processors in particular.
“Due to massive Russian attacks on food industry facilities, Kernel has suspended operations at all of its oil extraction plants,” the company said in a statement. “In recent days, Russian drones have deliberately attacked production facilities at Ukrainian processing plants, including Kernel assets. The attacks caused damage to production buildings, equipment and storage tanks,” it added.
A few hours later, Delta Wilmar halted all of its operations, which means it stopped originating sunflower and soybean. On Friday, Potoky announced the suspension of operations to guarantee the safety of its employees and to try to avoid Russian attacks.
Ukraine is prioritizing sunflower oil exports through alternative Danube routes, since the Black Sea remains unavailable, because it is a product with higher added value. Forcing a halt to sunflower processing operations on Ukrainian territory causes major economic damage not only to the agro-industrial sector but to the nation as a whole, through the restriction of foreign currency inflows.
According to the USDA, Ukraine should export 5.0 million tonnes of sunflower oil in the 2026/27 cycle, a figure that looks distant given the current restrictions. Part of what is no longer processed could be exported as seed to the European Union, but that would require much more costly logistics.
The USDA also projected this week Russian sunflower oil exports of 4.85 million tonnes in 2026/27, another estimate that is highly risky in the current context of reciprocal aggression between the two nations.
The third exporter on the list is Argentina, with an exportable supply, again according to the USDA, of 2.05 million tonnes for the 2026/27 campaign. On Friday, the official FOB price for Argentine bulk sunflower oil, as published by the Secretariat of Agriculture, was USD 1,334 per tonne for shipment in the last two months of this year, similar to the value recorded a month earlier (USD 1,339 per tonne) and 2.7% higher than two months ago (USD 1,298 per tonne).
