Dynamics of export of goods in 2021-2022
export.gov.ua
By the end of this year, metal prices and logistics costs have dropped significantly, which should help the demand
Russia’s military aggression against Ukraine has had a significant impact on the entire economy and the construction industry in particular. However, after a few months of war, some of the customers have already returned to the construction of commercial objects that were frozen at the beginning of the full-scale war or damaged as a result of the hostilities.
Current situation
Rauta is a leading supplier of modern solutions for quickly erected buildings – sandwich panels, ventilated metal facades, steel frames, load-bearing profiles, etc. The company offers services in design, installation of supporting and enclosing structures, as well as general contracting on objects of any complexity. The main focus of the company’s business is the import of Ruukki products for commercial construction projects. We use production facilities located in Poland, Estonia and Ukraine.
After the beginning of the active war phase due to a significant decrease in demand for our products the company’s business was significantly reoriented. We began to be approached by clients with requests to rebuild buildings destroyed in the fighting. Having a deep understanding of the technologies and principles of reconstruction, we began to actively engage in the restoration of buildings and made it a separate line of business. Whereas before February 24 the company was restoring only one building in Kiev, by the end of 2022 we had implemented 7 projects in three cities of Ukraine, and the start of reconstruction of several more is planned for 2023.
Growth against the backdrop of a falling market
In 2021 there was a situation on the market when the demand for Ruukki products greatly exceeded the capacity of production and the factories were not able to fulfill all orders. Starting from 24 February, the number of orders for new construction projects decreased sharply, and the main deliveries were for objects that began construction last year. Fortunately, almost all of our sandwich panel customers continued to build facilities. Among them are low-temperature warehouse and business center in Kiev, dairy farm and dairy plant in Ternopil region. Therefore, in 2022 Rauta has a 40% year-on-year decrease in sales, which is a relatively good indicator against the background of a more than 70% fall in the sandwich panel market. At the same time, thanks to the growth of the construction and general contracting services area, the company’s total revenue increased by 7% compared to 2021.
Price waves
Ruukki products are made only from European rolled steel, the price of which rose to a peak in August 2021 and halved in early 2022. At the same time in the cost of panels, galvanized steel with polymer coating accounts for about 25%.
At the same time, given the substantial increase in the cost of transportation services and the rise in the euro, the price of imported sandwich panels for the year increased by 50% in hryvnia equivalent. Nevertheless now there is a tendency in the market to considerable decrease of transport cost as well as inertial fall of world steel prices that in the nearest perspective can lead to reduction of sandwich-panels prices by 15-20%.
The main method of delivery in the market of metal construction is road transport. In 2021 the cost of delivery by truck from Poland to Kiev was about 65 thousand UAH. In the spring of 2022 delivery from Poland due to rising fuel prices and limited supply of transport has doubled in price, and in December 2022 was back to the prewar level.
In 2021 the peak cost of load-bearing steel reached almost 70 thousand UAH per ton, mainly due to the high cost of rolled steel. At the end of 2022 due to the decline in metal prices by almost half the cost of steel decreased by about 23% – to 54 thousand UAH per ton.
Recovery Opportunities.
In the spring of 2022, when the company had less workload on the main projects, we have developed a technology for the construction of frameless houses made of sandwich panels, which can be used for ultra-fast construction of houses and cottage towns. To demonstrate the benefits of this technology, we plan to install two demonstration frameless houses near Kiev. For this purpose we have already made house sets in Poland for 20 and 40 square meters houses and we are going to install them in spring. Now we can see the interest in this technology on the part of institutional funds and private investors in the segment of cottage building, which will grow rapidly after Ukraine’s victory.
Another innovation of ours is the development of technology for construction of multistoried buildings using sandwich panels as outer walls, which allows a developer to get up to 5% more space.
In general it can be noted that the technology of rapid construction with steel solutions has a great perspective in the reconstruction of commercial real estate – where the investor understands: the sooner the business is built, the sooner it will begin to bring income.
CONSTRUCTION, DEMAND, galvanized steel, RAUTA, STEEL, STEEL CONSTRUCTION
The U.S. dollar weakened against major world currencies on Monday due to the low trading activity because of the Christmas holidays.
The WSJ Dollar Index, which tracks the dollar’s movement against 16 currencies, is down 0.12%.
The euro is trading around $1.0629 versus $1.0617 in the previous session.
Analysts of Danske Bank have raised the forecast for the euro exchange rate in twelve months to $0.98 from the previously expected $0.93. The British national currency – to $1.15 from $1.08. At the same time they suggest that the Japanese national currency will cost about 128 yen/$1.
The value of the single European currency is now around 140.95 yen compared to 140.98 yen on Friday. The dollar is at 132.58 yen versus 132.79 yen at the end of the previous trading day.
The pound is trading at $1.2069 compared to $1.2051 on the previous trading day and the euro is at £0.8808 compared to £0.8810.
In any grocery store, whether it is a chain hypermarket or a small shop near the house, we can see in the window the so-called “processed foods,” that is, those that are cooked, preserved, frozen, packaged or altered by adding additional substances.
The accessibility, convenience and clever marketing of ultra-processed foods make them very attractive to the consumer, who does not think that we pay for the consumption of such food with our own health.
A recent study by Brazilian scientists at the University of São Paulo found an “alarming” link between the increasing consumption of highly processed foods, such as white bread and sugary carbonated beverages, and premature death.
Researchers looked at 2019 mortality data in Brazil and concluded that consumption of ultra-processed foods caused 10 percent of premature deaths.
“Previous studies have assessed the health and economic burdens of food-critical ingredients such as sugar, salt and trans fats, as well as individual products such as sugary carbonated beverages,” study author Eduardo Nielson said in a statement.
“To our knowledge, no study to date has evaluated the potential effect of ultra-processed foods on the occurrence of premature death. Knowing the risks associated with eating such foods and modeling changes in the human diet can contribute to better food policies and prevent the onset and development of chronic disease,” Nielson added.
Ultra-processed foods such as packaged and ready-to-eat snacks, frozen pizza, sugary drinks and breakfast cereals form a significant part of the modern human diet. But a growing body of research links such eating behavior to high risks of obesity, dementia and cancer. Scientists also note that such foods are very low in protein and fiber and high in sugar, fat and salt.
Scientists believe that in high-income countries such as the U.S., U.K. and Canada, where ultra-processed foods account for about half of total calorie intake, the health effects of such diets would be higher.
Researchers say reducing the consumption of processed foods by 10 percent could potentially prevent between 5,900 and 29,300 premature deaths per year in Brazil.
The Club of Experts information and analysis project analyzed the effects of food additives on humans, see the video at this link for more details
Over 15 million tons of agricultural products were exported from Ukraine during the “grain deal”, Minister of Transport and Infrastructure of Turkey Adil Karaismailoglu said.
“According to the minister, from the first of August to December 25, 585 dry cargo ships departed from Ukrainian ports. A total of 15 million 80 thousand tons of 13 varieties of agricultural products were transported through the “grain corridor,” he said,” reports Anadolu.
He noted that 44% of the products coming from Ukraine were sent to European countries, 29% – to Asian countries, 15% – to Turkey and 12% – to African countries.
On July 22 in Istanbul with the participation of the UN, Russia, Turkey and Ukraine signed documents to create a corridor for the export of grain from three ports in the Ukrainian territory – Chornomorsk, Odessa and Yuzhny.
Curfew in Ukraine will not be canceled on New Year’s Eve, violators will be detained, the press secretary of the head of the National Police, Maryana Reva, said.
“People should understand that no matter what day we have – holiday or non-holiday – there are certain curfew requirements. Police officers will check individuals, check their documents, take them to police departments to identify or verify that person,” she said on the telethon.
Reva stressed that those who go out on New Year’s Eve could be prosecuted for violating the curfew.
She also noted that pyrotechnics and their sale, their use in almost all the territory of Ukraine is expressly prohibited and the police will respond to such cases.
