Industrial enterprises are asking the National Commission for State Regulation in the Spheres of Energy and Public Utilities (NEURC) not to increase the marginal prices (so-called price caps) for electricity on the day ahead market (RDA), intraday market (HRV) and the balancing market to avoid stopping production.
Sources in the market told Interfax-Ukraine that there is a significant possibility of stopping production, in particular, such statements were made on October 12 during a public discussion of the draft decision at the NEURC.
Thus, Alexander Zavgorodniy, Director for Economics and Finance of the Nikopol Ferroalloy Plant (NFP), said that electricity is the main component of the cost of the plant’s products, so the rise in prices will significantly affect the economy of the enterprise.
“Given the likely increase in price caps, rising prices in the electricity market, as well as intentions to increase the cost of transportation and dispatching of electricity, we have decided to stop the operation of the enterprise from November,” the top manager said, adding that the enterprise plans in advance in this case is idle in the winter.
In turn, Oleg Kachko, Deputy Chairman of the Board for Finance of the Zaporozhye Ferroalloy Plant (ZZF), stressed that an increase in price caps will inevitably lead to an increase in electricity prices and, as a result, will lead to an increase in production costs and an inevitable shutdown of the enterprise.
According to him, the increase in price caps will cost the company an additional UAH 1 billion per year. “It is not known where to get these funds, when there are problems with logistics within the country, you need to keep staff, pay salaries. Therefore, in a war, this is not a very right decision,” said the representative of the ZZF.
At the same time, the Dniprozot plant, the only producer of chlorine for Ukrainian water utilities, has been idle since the very beginning of the war. However, due to the technological danger of the production cycle, the enterprise maintains minimal economic activity. However, according to the representative of the company, due to the increase in price caps for electricity costs, Dniproazot will have to stop completely, and the resumption of work will no longer be possible.
The mining industry is also under threat of a complete shutdown. In particular, Alexander Petrovets, Deputy Chief Power Engineer of the Pokrovsky Mining and Processing Plant (PGOK), said that there is a high probability that the enterprise will shut down in November due to an increase in price caps.
“PGOK is a city-forming enterprise, the existence of the city of Pokrovsk depends on our work. We try to work in extremely difficult conditions: the demand for our products is decreasing, the cost of production is growing, there are problems with the purchase of materials for repairs and maintenance of equipment. Therefore, our enterprise can no longer withstand this difficult situation,” the top manager stated.
Vladimir Bodnar, Deputy Chairman of the Board for Economics and Finance of the Marganets GOK (MGOK), recalled that the enterprise is constantly under fire from enemy artillery. However, due to rising costs, the work of the enterprise may stop. “And if price caps rise, then due to the shutdown of a large number of enterprises, there will be no one to sell this electricity to,” Bodnar concluded.
The Ministry of Economy proposed at a meeting with food industry associations on October 11 that the terms of settlement of goods producers and retailers be set at 24-30 days as a compromise and slightly expand the list of goods for the effective uninterrupted work of both parties.
“We are trying to bring the positions of the parties closer. In particular, as a compromise option, we propose to set a settlement period of 24 or 30 days. If the parties do not agree, we will be forced to use other mechanisms, although the government is fundamentally against strengthening regulation,” the First Deputy Prime Minister is quoted as saying. – Minister of Economy Yulia Sviridenko press service of the department.
According to her, the issue of payments for delivered goods is really painful, since each of the parties believes that it is lending at its own expense to the other.
“We are talking, in particular, about payments for goods of significant social importance, and about debts for previously delivered goods. The government believes that the best solution is to coordinate the positions of manufacturers and sellers in the dialogue process and strengthen the discipline of payments,” Sviridenko said.
During the meeting, issues were also raised of providing food industries with preferential gas, lending to food and processing enterprises under the 5-7-9 program, uninterrupted supply of electricity to food industry enterprises during rolling blackouts, as well as issues of limiting the export of sunflower seeds and obtaining permission for transactions for certain types of import operations.
The Ministry of Economy noted that at present gas at preferential prices is received by enterprises of the baking industry and dairy products, and now the country does not have the opportunity to expand the corresponding list. As Sviridenko explained, first of all, it is necessary to provide the population with preferential gas, but, given the importance of the stable operation of enterprises in the industry, the issue of the possibility of purchasing additional volumes of gas for preferential supplies to the food industry will be worked out.
According to the agency, the head of the Ministry of Economy also supported the request of the food industry to include industry enterprises in the list of critical infrastructure, which will allow them to receive electricity even during rolling blackouts. According to her, this issue will be worked out with the Ministry of Energy and local authorities, which form the relevant lists.
The UN General Assembly adopted a resolution on respect for the territorial integrity of Ukraine, which also condemns the attempt of the Russian Federation to annex the temporarily occupied territories of Donetsk, Luhansk, Kherson and Zaporozhye regions of Ukraine.
The resolution calls on countries not to recognize Russia’s claims to the four regions of Ukraine claimed by Russia after the so-called referendums held late last month, and demands that Moscow change course from an “illegal annexation attempt,” according to a press release posted on the website. UN.
The resolution, “protecting the principles” of the UN Charter, notes that the Donetsk, Kherson, Lugansk and Zaporozhye regions are temporarily occupied by Russia as a result of aggression, violation of the territorial integrity, sovereignty and political independence of Ukraine.
The General Assembly automatically brought the resolution to the discussion caused by Russia’s use of the right of veto in the Security Council in connection with the attempted annexation.
The resolution adopted by the Assembly calls on all states, the UN and international organizations not to recognize any claims of Russia for annexation and demands the immediate cancellation of its application for annexation. The resolution welcomes and “expresses strong support” for the continued efforts of the Secretary-General and Member States to de-escalate the current situation in search of peace through dialogue, negotiation and mediation.
According to the broadcast from the General Assembly hall, 143 out of 193 participants voted in favor, 35 countries abstained (Algeria, Armenia, Bolivia, Burundi, Central African Republic, China, Congo, Cuba, Eritrea, Eswatini, Ethiopia, Guinea, Honduras, India, Kazakhstan, Kyrgyzstan, Laos, Lesotho, Mali, Mongolia, Mozambique, Namibia, Pakistan, South Africa, South Sudan, Sri Lanka, Sudan, Tajikistan, Thailand, Togo, Uganda, Tanzania, Uzbekistan, Vietnam, Zimbabwe), voted 5 against (Belarus, DPRK , Nicaragua, Russia and Syria).
U.S. chip makers are recalling employees from China’s leading memory chip maker, Yangtze Memory Technologies Co. (YMTC), writes The Wall Street Journal, citing informed sources.
In particular, we are talking about KLA Corp. and Lam Research Corp., which are suspending cooperation with a Chinese state-owned company after Washington imposed restrictions blocking the supply of high-tech semiconductor components and equipment for their production in China.
U.S. companies have suspended maintenance on existing equipment at the YMTC facility and have also stopped installing new equipment, sources said.
In total, dozens of employees of American companies are involved in the plant, who play a key role in maintaining the operation of the enterprise, having the expertise necessary for high-tech production, the sources say.
If these employees do not return to work, YMTC will not be able to modernize production in the future, and will also face difficulties when equipment needs to be repaired.
Under new export controls announced last Friday, high-performance computing, supercomputing and artificial intelligence (AI) chips made using US technology can only be sold to China with an export license.
Washington also banned US citizens and organizations from working with Chinese chipmakers without special permission.
In addition, the US-announced package severely restricts exports to China of chip manufacturing equipment and technologies that local companies could use to develop their own equipment.
According to Boston Consulting Group estimates, US companies account for 41% of global production of equipment for the production of chips, China – no more than 5%.
PJSC “Zaporozhkoks”, one of the largest producers of coke products in Ukraine, which is part of the “Metinvest” group, in January-September of this year reduced the production of blast-furnace coke by 17.7% compared to the same period last year – up to 527.9 thousand tons. tons.
According to the company, 61.3 thousand tons were produced in September.
“The decrease in production compared to the same period last year is associated with a shortage of raw materials caused by military operations,” the company explains.
As reported, in 2021, Zaporizhkoks reduced production by 1.9% compared to 2020, to 837.2 thousand tons.
“Zaporozhkoks” produces about 10% of coke produced in Ukraine, owns a full technological cycle for processing coke products. In addition, it produces coke oven gas and pitch coke.
Metinvest is a vertically integrated mining group of companies. Its main shareholders are SCM Group (71.24%) and Smart Holding (23.76%), which jointly manage the company.
Metinvest Holding LLC is the management company of the Metinvest group.
European stock markets continue to decline on Wednesday for the sixth session in a row on investor anxiety due to further economic growth and rising interest rates in the world.
Traders are waiting for the publication of data on changes in US consumer prices in September, which may indicate how effective the tightening policy of the US Federal Reserve System (FRS) is. The report of the Ministry of Labor of the country will be published on Thursday at 15:30 square meters. Analysts expect U.S. inflation to slow to 8.1% last month from 8.3% in August, according to Trading Economics.
The composite index of the largest enterprises in Europe Stoxx Europe 600 fell by 11:20 qoq by 0.4% to 386.39 points.
The German DAX is losing 0.4%, the French CAC 40 – 0.18%, the British FTSE 100 – 0.1%. The Italian FTSE MIB and the Spanish IBEX 35 are down 1% each.
UK GDP in August fell by 0.3% in monthly terms after rising by 0.1% in July, data from the country’s statistics agency ONS showed. Experts on average expected that the volume of the country’s economy in the month before last would not change compared to July, according to Trading Economics.
In annual terms, UK GDP growth slowed to 2% from 3.1% in July.
Industrial production in the UK fell 1.8% in August from July after falling 1.1% a month earlier, the ONS report also said. At the same time, the volume of production in the manufacturing industry fell by 1.6%, in the mining industry – by 8.2%, and in power generation – by 0.6%.
In annual terms, industrial production in the country in August fell by 5.2% compared with a decline of 3.2% a month earlier.
The UK trade deficit widened to £7.1bn ($7.8bn) last month from £5.4bn in July. Imports rose 4.3% m/m to a record £75.3bn, exports up 2.2% to £68.2bn.
Consumer goods and medical equipment maker Royal Philips NV shed 8.4%. The Dutch company said its third-quarter like-for-like sales were down about 5% due to stronger-than-expected problems in its electronics supply chains.
Among the decline leaders in the Stoxx 600 is also TAG Immobilien AG (-9.3%), which operates in residential real estate.
Meanwhile, LVMH Moet Hennessy Louis Vuitton SA, the world’s largest luxury goods maker, is up 2.2%. The company on Tuesday evening after the close of trading published a statement in which it said that its revenue in the third quarter of 2022 increased by 27%, surpassing market forecasts.
Danish biopharmaceutical company Chr. Hansen Holding AS surged 12.7% after posting strong third-quarter results and a promising full-year outlook.
