The quota for the export of mineral or chemical fertilizers, nitrogen (UKTVED code 3102) has been reduced from 210,000 tons per quarter to zero, that is, in fact, a ban on the export of these goods from the country has been reintroduced.
The corresponding resolution of the Cabinet of Ministers No. 759 of July 1 was published on its website on Thursday.
Earlier, immediately after the government meeting on July 1, its representative in parliament, Taras Melnichuk, said that nitrogen mineral fertilizers were excluded, along with oats, from the list of goods whose exports are subject to quotas, and are included in the list of goods whose exports are subject to licensing.
However, the published decree regarding oats confirmed this information, but refuted it regarding mineral fertilizers and actually tightened exports, and did not liberalize it.
As reported, nitrogen fertilizers were banned for export at the beginning of March, but at the end of March the government allowed their export within the quarterly quota of 210,000 tons, or 70,000 tons per month.
Ukraine’s international reserves as of July 1, 2022, according to preliminary data, amounted to $22.757 billion (in equivalent), which is 9% less than at the beginning of June ($25.1 billion), according to the data National Bank of Ukraine (NBU), released on Thursday.
“As of July 1, 2022, Ukraine’s international reserves, according to preliminary data, amounted to $22.757 billion. In June, they decreased by 9% due to the sale of foreign exchange currency on the interbank market. The intensification of the flow of international assistance to Ukraine made it possible to partially comment appropriate interventions,” the regulator explained.
The central bank notes that the dynamics of reserves in June was affected by public debt management operations: the total volume of payments for servicing and repaying state and state-guaranteed debt in foreign currency amounted to $833.6 million in equivalent.
It is specified that $672.1 million of them were directed to the repayment of government bonds, $70.1 million – to service external government loans, and the rest of the amount – to settlements with other creditors.
At the same time, in June, foreign exchange earnings in favor of the government amounted to $2.763 billion in equivalent, including $967.4 million from the World Bank, $779 million from the government of Canada, $479.4 million from the Japan International Cooperation Agency, and $354.2 million from the placement of foreign currency government bonds.
In addition, the NBU and the government of Ukraine in June paid $166.2 million to the International Monetary Fund (IMF).
The NBU operations on the interbank market also affected the dynamics of reserves. In June, the regulator sold $3.987 billion on the foreign exchange market and bought $31 million.
In addition, the dynamics of the indicator was affected by the revaluation of financial instruments (changes in the market value and the exchange rate of the hryvnia against foreign currencies): last month their value decreased by $152.2 million in equivalent, according to NBU data.
The regulator also clarified that the net international reserves of Ukraine in June decreased by $2 billion, or by 13.4%, to $12.9 billion.
As reported, at the beginning of 2022, Ukraine’s international reserves amounted to $30.941 billion, net international reserves – $20.767 billion.
British Ferrexpo plc, which controls in Ukraine, in particular, Poltava and Yeristovo mining and processing plants, reduced production of pellets by 14% in January-June 2022 compared to the same period last year, to 4.797 million tonnes.
According to the company’s press release on Thursday, pellet production in the second quarter of this year decreased by 23% compared to the first quarter, and by 27% by April-June 2021, to 2.085 million tonnes.
In the first half of 2022, production of premium pellets with an iron content of 65% amounted to 4.707 million tonnes (a decrease of 13%), including in the second quarter – 1.994 million tonnes (a decrease of 26% compared to the previous quarter and 28% compared to the same period last of the year). Output of direct reduced iron pellets (DRI, 67% of iron) in January-June amounted to 90,000 tonnes (an increase of 33% compared to six months of 2021), which were produced in the second quarter of this year, while they were not produced in the first one.
Pellets with an iron content of 62% were not produced in January-June of the current year.
At the same time, total production of marketable products (pellets and iron ore concentrate) over six months of 2022 decreased by 16%, to 4.816 million tonnes, in the second quarter compared to the first one – by 22%, and versus April-June 2021 – by 28%, to 2.103 million tonnes. In particular, output of commercial concentrate over six months of 2022 decreased by 88%, to 19,000 tonnes, the entire volume was produced in the second quarter, while there was no output in January-March.
The company explains the decline in pellet production by the ongoing war of the Russian Federation in Ukraine and the associated logistical restrictions. The Group continues to operate one to three of its pelletizing lines, reflecting the availability of logistics in Ukraine.
Sales in the first half of 2022 were 4.4 million tonnes, a decrease of 21% year-on-year and reflecting logistical constraints. At the same time, the group is negotiating with a number of logistics providers to resume access to maritime markets through neighboring countries.
Jim North, Chief Executive Officer of Ferrexpo, noted in his comment that the company continues to work and adapt its business in Ukraine as new risks emerge.
“We also continue to be impressed by the remarkable resilience of the people of Ukraine, despite the continual bombardment over the last four months. Our production result in the second quarter of 2022 reflects the determination of our people, our suppliers and our customers… In terms of logistics availability, which remains the largest constraint on our business at the present time, we are advancing efforts to increase seaborne exports and have made initial deliveries to customers,” he said.
Ferrexpo is an iron ore company with assets in Ukraine.
The international research company Corteva Agriscience will open ten training sites in Ukraine this year to train Ukrainian farmers in sunflower and corn cultivation technologies, according to its press release on Thursday.
At the same time, it is specified that Corteva experts will conduct agronomic training at professional experimental plots, demonstrating to agricultural producers the reactions of crops to various agrotechnical factors. The service is available to the company’s customers who can apply to the commercial team for training.
Earlier, in April, due to Russian military aggression against Ukraine, Corteva decided to leave the Russian market.
Corteva Agriscience is a global agricultural company. It offers farmers comprehensive solutions to maximize yields and profitability. It has more than 150 research facilities and more than 65 active ingredients in the portfolio.
JSC Ukrzaliznytsia exported 804,900 tonnes of grain cargo in June 2022, which is approximately the same as last month (807,000 tonnes), Deputy Director of the Department of Commercial Work at Ukrzaliznytsia Valeriy Tkachev said on Facebook during online meetings with industry representatives on Thursday.
In particular, 639,900 tonnes of grain were transported through land border crossings on the western border, and 165,000 tonnes were delivered to ports.
Tkachev specified that in June 2022, Ukrzaliznytsia loaded 1.23 million tonnes of grain into wagons, which is 14% of the total loaded volume of 8.57 million tonnes.
At the same time, the volume of transportation of grain cargo amounted to 1.36 million tonnes in June, which is 10.5% more than the volume of loading for this period.
According to Tkachev, the volume of average daily loading into wagons in June amounted to 38,000 tonnes. This figure tends to decrease on weekends: if on weekdays 50,000-70,000 tonnes are loaded into Ukrzaliznytsia wagons, then on weekends – an average of 26,000 tonnes.
Customs revenues in June increased by 33% compared to May, to UAH 12.69 billion, Yaroslav Zhelezniak, the deputy head of the parliamentary committee on finance, taxation and customs policy, said.
“The results of the work of customs in June: receipts amounted to UAH 12.69 billion. On the one hand, this is already 33%, or UAH 3.1 billion more than received in May from customs,” he said on Telegram.
Zhelezniak recalled that import exemptions were still in effect in June, which means that the June customs results indicate a gradual resumption of economic activity.
“On the other hand, such an income is only a third (32%) of what was supposed to come from customs in peacetime – the plan was UAH 34 billion,” Zhelezniak said.
