The Joint Coordination Center in Istanbul for maritime exports of agricultural products from Ukraine continues to work intensively, as it is necessary to send the first ships with Ukrainian grain to customers as soon as possible.
This was announced by Turkish Defense Minister Hulusi Akar during a meeting with Minister of Infrastructure of Ukraine Oleksandr Kubrakov, according to the website of the Turkish Ministry of Defense.
During the meeting, Akar said Turkey is fulfilling and will continue to fulfill its part of the obligations as part of the shipment of goods from the seaports of Ukraine.
According to the Turkish department, its head expressed satisfaction with the news about the possible start of grain exports from Ukraine this week.
Kernel, one of the largest Ukrainian agro-industrial groups, in the 2022 financial year (FY, July 2021-June 2022) reduced sales of vegetable oil (sunflower and rapeseeds) by 29% compared to FY 2021 – to 967,000 tonnes from 1.37 million tonnes, the total processing of oilseeds – by 31%, to 2.19 million tonnes from 3.18 million tonnes.
According to a report published on the company’s website, the decline in production and sales of oilseeds and vegetable oil was caused by the blockade of Ukrainian seaports by warships of the aggressor country of the Russian Federation, as a result of which the active harvesting, processing and export of grain and sunflower oil was stopped.
It is specified that in the fourth quarter of FY2022 (March 2022-June 2022), Kernel sold 60,800 tonnes of sunflower and rapeseeds oil (less by 78% compared from the fourth quarter of FY2021) and processed 156,600 tonnes of oilseeds crops.
The total export of agricultural crops by Kernel in the fourth quarter of FY2022 decreased by 93% compared to the same period of the last fiscal year, to 123,000 tonnes, while in FY2022 the reduction was 1% – to 7.97 million tonnes.
In total, in the fourth quarter of FY2022, the group of companies increased the volume of agricultural products delivered to its elevators by 12% compared to the fourth quarter of FY2021, to 65,500 tonnes, while for the entire FY2022, some 4.19 million tonnes of agricultural raw materials were delivered to elevators – 10% more than in FY2021.
“The situation with the group’s critical infrastructure remains unchanged. The group’s two oil extraction plants in Kharkiv region, located in the temporarily occupied territories, remain inaccessible. The new granaries were not damaged, except for two silos with a capacity of 74,000 tonnes, which were badly damaged in the spring of 2022,” the group said.
“Since the beginning of the war with Russia, 1,150 of our employees have been mobilized into the Armed Forces of Ukraine or joined the defense units. Of these, 460 were demobilized and returned to work,” the agricultural holding stated.
Kernel also noted with regret that 11 of its employees were killed in Ukraine due to the military aggression of the Russian Federation.
The European Investment Bank (EIB) will provide EUR 1.59 billion supported by guarantees from the EU budget, to help Ukraine repair the most essential damaged infrastructure and resume critically important projects addressing the urgent needs of Ukrainian people, the European Commission said on Tuesday.
“This EIB support will keep strategic public sector companies financially viable and able to carry out urgent repairs of critical infrastructure, resume the provision of essential services and address other immediate needs of the Ukrainian people, including those displaced by Russia’s war,” European Commission Executive Vice-President Valdis Dombrovskis said.
He assured that “the European Commission will keep working with EU Member States and our international partners to support Ukraine on every level — for as long as it takes.”
The European Commission said that This is the second package of support for Ukraine under the EIB Ukraine solidarity urgent response developed in close cooperation with the European Commission. It follows an emergency support package of EUR 668 million.
Like the first one, this new financing is offered at favourable terms including long tenors.
The bank will immediately disburse EUR 1.05 billion. It will help the Ukrainian government to cover priority short-term financing needs, provide support to strategic state-owned companies, ensure urgent repairs of damaged infrastructure, resume the provision of disrupted municipal services, and support urgent energy and energy efficiency measures in preparation for the cold season.
Another EUR 540 million will be used to resume implementation of EIB-financed projects in Ukraine where possible. The selected projects will cover energy, energy efficiency, roads, transport, education and infrastructure, as well as reconstruction and recovery programmes, the European Commission said.
In January-June of this year, the State Customs Service of Ukraine issued 80 certificates for the export of scrap metal to EU countries to enterprises dealing with ferrous scrap, according to the Ministry of Finance’s response to the letter of the Ukrainian Association of Secondary Metals (“UAVtormet”), dated July 23, 2022.
At the same time, the Ministry of Finance stated that the State Customs Service did not receive requests from subjects of foreign economic activity regarding problems in obtaining certificates.
In turn, “UAVtormet” sent a letter to the Ministry of Finance and the State Customs Service on June 20, 2022, a copy of which is in the possession of the “Interfax-Ukraine” agency, in which it pointed out the appeal of market participants regarding selectivity in the issuance of permits for export procedures, in particular, in the issuance of certificates for supply of scrap to the EU.
In the appeal of “UAVtormet” it was emphasized that the Ministry issued an order dated March 2, 2021 approving the procedure for issuing certificates. According to the Association, the procedure for obtaining a certificate is significantly complicated, it does not contain a complete list of necessary documents, and the procedure for a full or partial inspection of vehicles for product identification is used to delay the registration of export consignments.
UAVtormet believes that this creates corruption risks and causes financial losses to both the state and Ukrainian business.
The association asked the Ministry of Finance to hold an operational meeting on problematic issues in the export of scrap metal, with the involvement of experts from the ministry, the State Customs Service, the Chamber of Commerce and Industry, “UAVtormet” and “UAVtormetresurs”.
As reported, Ukrainian enterprises in January-June of this year reduced the export of ferrous metal scrap eightfold compared to the same period last year – to 28.74 thousand tons, in monetary terms, the export of scrap metal decreased by 6.8 times – to $12.24 million.
Scrap metal was exported in January-June 2022 mainly to Turkey (61.35%), Poland (12.49%) and Germany (9.45%).
In 2021, Ukraine increased the export of scrap metal by 17.2 times compared to the previous year – up to 615.69 thousand tons. In monetary terms, the export of scrap metal increased 25.2 times to $238.90 million.
Ukrainian Association of Secondary Metals (“UAVtormet”), Ukrainian Association of Scrap Metal Exporters (UAEM) and “Ukrainian Association of Secondary Metals and Resources” (“UAVtormetresurs”) operate in Ukraine.
CERTIFICATES, EU, EXPORT, SCRAP METAL, STATE CUSTOMS SERVICE
In January-June of this year, the enterprises of the association “Ukrtruboprom” reduced the production of pipes by 24.4% compared to the same period last year – to 235.2 thousand tons.
According to the updated data of the association, in January, “Ukrtruboprom” enterprises increased the output of pipes by 2.2 times compared to the same period last year – to 61.3 thousand tons, in February – by 16.2%, to 49 thousand tons. tons, but production has been declining since March.
So, in March, the output of pipes was 3.5 thousand tons (5.9% to March-2021), in April – 18.5 thousand tons (32.1% to March-2021), in May – 51.4 thousand tons (86.5%), in June – 51.6 thousand tons (76.6%).
In general, in the first half of the year, all plants demonstrated negative dynamics. “Interpipe Nico Tube” and “Trubostal” reduced the production of seamless pipes by 14% and 44.4%, respectively, “Sentravis” – stainless pipes by 25%, “Interpipe NMTZ” – electric welding pipes by 37.6%.
General Director of “Ukrtruboprom” Giorgiy Polskyi noted that at the beginning of the year, pipe factories increased production against the background of favorable conditions in foreign markets, which is mainly due to the post-Kovid recovery of the world economy and high hydrocarbon prices. However, the full-scale invasion of Russian troops on the territory of Ukraine led to the sharpest decline in production: in March, almost the entire industry came to a standstill.
“In April, Ukrainian pipe manufacturers began to cautiously start up production facilities, and in May-June enterprises reached 50% capacity utilization from the pre-war period. However, individual plants are severely underutilized, as new supply chains and logistics schemes are still in the process of restructuring and formation, for example, “Interpipe NMTZ” used to receive raw materials (strips) from “Azovstal”, but now it is impossible due to the occupation of Mariupol,” said Polsky, quoted by the press service.
According to him, now logistics is the main factor why pipe factories cannot reach pre-war production volumes. The outage of many suppliers in the east and south of Ukraine has been a big loss for pipe workers from the point of view of traditional supply chains. In addition, many traditional logistics schemes have been disrupted: Ukrainian seaports on the Black Sea have been blocked, there is a serious shortage of gasoline and diesel fuel in the country, and the transport infrastructure has been destroyed by enemy missile strikes.
“This forces enterprises to look for new, more expensive routes for transporting products for export through western border crossings and European seaports. In addition, the constant increase in energy prices, primarily natural gas and electricity, lead to an additional increase in the cost of pipe products and reduce their competitiveness on foreign markets”, – summed up the general director.
As reported, in 2021, Ukraine increased the output of pipes by 15.1% compared to the previous year – to 980.7 thousand tons, in particular, the enterprises of “Ukrtruboprom” increased their production by 32.6% – to 710.5 thousand tons.
German Vice-Chancellor, Minister for Economy and Climate Protection Robert Habeck called the situation with gas supplies in the country “serious” and called for a reduction in its consumption by 15-20%.
On the air of the ARD TV channel, referring to Gazprom’s announcement of a further reduction in fuel supplies from July 27, he said that “we must be prepared for this,” and “this is a serious situation.”
Habek noted that Germany will continue to receive gas from the Netherlands and Norway, “we will be able to continue to fill the storage, but how quickly and in what volumes,” it will be clear later. He added that “we will not have gas in abundance.”
The minister called for a 15-20% reduction in gas consumption to avoid that “certain production chains simply cease to exist in Germany or Europe.”
The official promised that in the event of a shortage of gas, industrial sectors would be the first to suffer, while measures would be taken to provide residential buildings and infrastructure such as hospitals.
In an interview with DPA, Habek said he sees no “technical reasons” for Gazprom’s cuts in supplies.
As previously reported by Gazprom, gas pumping through Nord Stream will be reduced to one-fifth of its capacity from Wednesday.
