While 2021 presented some unprecedented and challenging aspects for the sunflower sector across Canada and the U.S., it’s looking to industry insiders like 2022 will pick up where 2020 left off.
Going back about 24 months, 2020 was a banner year for sunflowers, with very strong markets and more expansion of acreage. At the start of 2021, the U.S. and Canadian outlooks for the oil and confection markets were described as never being better. Indeed, a year ago in Nuseed Succeed, John Sandbakken, Executive Director of the National Sunflower Association, said the sunflower industries in Canada and the U.S. had been working together well — and that going into 2021, farmers had been offered “great prices to keep the momentum going.”
However, while U.S. and Canadian sunflower acreage grew as much as 30% in 2020, it fell in 2021 due to historically high corn and soybean prices. “At those price levels,” explains Mark Jackson, General Manager of Nuseed Americas,“ those in some of the key sunflower-growing regions took a chance and added more corn and soybean acres, bringing sunflower inventories lower.”
But no one can predict weather patterns, and during 2021, some of the growers who planted more corn and soybeans were faced with tough times. “With the hot, dry growing season of 2021 in many areas, performance of these crops fell short,” Jackson reports. “It’s actually under those types of conditions that the benefits of sunflower tend to show. The plant has a root structure that can go deeper in order to access subsoil moisture and nutrients. It’s an excellent reason to add sunflower into your crop plan in 2022. The taproot can also do an excellent job to break through hardpan.”
Agronomics aside, strong demand is another reason why sunflowers are a smart choice this year. Overall, Jackson states that North American market opportunities are excellent.
“Fundamentally, we continue to see sunflower oil-based products grow at a faster pace than those made from commodity alternatives,” he says. “It all revolves around sunflowers non-GM status, healthy oil profile and quality protein. They all come together to make sunflower an easy choice for consumers looking to make healthier food choices.”
Indeed, inventories are small and demand is high going into 2022 for all sunflower segments: oilseed crush, dehull or kernel, and birdseed. Jackson explains that “from all indications so far, sunflower is going to have a great year. The processors have already put out lucrative contracts and this is driving early grower decisions to go with sunflowers. With open contracts from oilseed crush to birdseed, growers have a lot of opportunity right now.”
The overall production ratio for oil versus confection has stayed stable over the last few years, but with a small gain by oil types. It’s now about 90/10% oil/confection and this is expected to stay about the same for the next year.
The confection sunflower market is also predicted to be strong in 2022. The pandemic found us spending more time at home and snacking more, but we want those snacks to be healthy. Sunflower seeds fit the bill, being heart-healthy and also a great source of protein.
While confection production does involve more focus on managing insect pressures and other potential quality issues, growers are rewarded with strong premiums. This is why first-time sunflower growers usually target the oil market (crushing, kernel processing and birdseed) and then decide in subsequent years if they are ready to grow for the confection market.
Jackson also notes that while confection producers have always been offered contracts with an ‘Act of God’ clause (a shortfall is given if the yield is not achieved), it has been a few years now that some oil market contracts also contain this clause.
2022 and Beyond
Looking forward, 2022 appears to be a very good year to grow sunflowers.
“With high demand, a range of hybrids and strong agronomic advantages for this crop,” says Jackson, “we expect that 2021 will go down as a blip in otherwise steady trends towards higher returns and expanded acreage.”
