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The year 2025 for Ukraine's agricultural sector has become a year of resilience and adaptation to a new reality. Amidst war, logistical constraints, price pressure, and rising risks, farmers are forced to operate in an environment where economic efficiency takes center stage, and the room for margins is constantly narrowing.   As Pavlo Koval, General Director of the Ukrainian Agrarian Confederation, emphasizes, these processes are characteristic not only of Ukraine.

Russia is deliberately targeting Ukraine’s vegetable oil sector, carrying out systematic strikes on processing plants, ports, and infrastructure. Against this backdrop, vegetable oil prices have surged, with sunflower oil FOB six ports reaching their highest level since August 2022.

Over the past three weeks, there have been at least nine strikes on processing facilities and port infrastructure. According to market participants, about 25% of processing capacity is currently idle due to logistical disruptions, power supply problems, and security risks.

As of January 8, sunflower oil FOB six European ports — Rotterdam, Amsterdam, Antwerp, Ghent, Dunkirk, and Dieppe — rose to around $1,409 per ton for February shipments, up $80 per ton from mid-December levels. This is the highest price since August 2022.

The introduction of export duties on soybeans and rapeseed has had a tangible effect: the utilization of processing capacities has increased to the maximum level in recent years. This is reported by the Ministry of Economy and Agriculture of Ukraine.

“In terms of stimulating processing, the effect is there – and it is measurable. Capacity utilization has increased, oilseed processing is currently at the maximum level in recent years. This indicates that the market has reacted exactly as was laid down in the logic of the norm,” said Oleksiy Sobolev, Minister of Economy, Environment and Agriculture of Ukraine.

According to him, the Ministry of Economy is building a policy where crops grown in Ukraine are more profitable to process domestically than to export raw materials and only then export processed products. This approach is aimed at moving away from the model of a raw material economy.

Sugarcane production and cane sugar content are affected not only by weather, but also by the increasingly influential cane sugar processing into ethanol. That makes sugar more volatile and more sensitive to every new forecast on cane yields, crushing pace, and the ethanol usage.

In the last few seasons, sugar prices flowed a downtrend with short, sharp rallies. Traders consider any forecast of production decline as a signal for price upward move, but the market is now getting a different story for the transition from 2024/25 to 2025/26 season with higher global output and a more comfortable balance.

The main drivers of the sugar market in 2025 were the forecasts of the deficit of sugar on the world market from ISO for one season 2024/25. Over the four updates of the forecast, significant changes have occurred – an increase in the production/consumption gap and a sharp reduction in the deficit indicator.