Business news from Ukraine

“Forests of Ukraine” put up surplus firewood for auctions

The State Enterprise “Forests of Ukraine” is starting to sell surplus firewood for industrial use to domestic and foreign buyers and is ready to provide additional services to non-residents, the press service of the state company reported on Facebook.

“The State Enterprise “Forests of Ukraine” is starting to hold the first auctions with additional services for non-resident companies. In particular, we offer delivery from the warehouse and loading of products into railway cars, as well as customs clearance of products,” the statement said.

According to the report, as the heating season approaches its end, state forestry enterprises have accumulated surplus fuel wood, most of which is industrial firewood. Currently, only industrial pine firewood is up for auction.

Since last year, the selling price of such firewood has fallen from UAH 1,350 per cubic meter to UAH 950 per cubic meter. The products were sold at the main and then at additional auctions. However, even with a one-third reduction in price, the Ukrainian market is not ready to consume all the resources put up for auction.

At the same time, the Forests of Ukraine noted that the volume of wood is sufficient to satisfy both Ukrainian processors and non-resident buyers.

As reported, in 2023, the volume of logging in Ukraine amounted to 15.7 million cubic meters of wood of all types of felling, 13.1 million cubic meters of which were harvested by state forestries.


Sanctioned property in Ukraine will be sold at online auctions in Prozorro.Sale

Sanctioned assets will be sold through online auctions in the state electronic trading system Prozorro.Sale, the relevant Procedure for the management of sanctioned assets was approved by the Cabinet of Ministers of Ukraine at the request of the Ministry of Economy at the end of November 2023.
“The government is consistently implementing the best practices of managing state assets through their sale at transparent and competitive electronic auctions,” commented Deputy Minister of Economy Oleksiy Sobolev.
According to him, the Procedure creates a comprehensive legislative framework for the management of various assets related to the aggressor country, as well as increases the confidence of potential investors in the public property management system and helps attract long-term investments, which is a priority for the coming years.
The Ministry of Economy reminded that the government approved this decision pursuant to Law 3137-IX, which has been in force since June this year, amending the sanctions legislation, and now the law and the Procedure determine the procedures for the sale of the recovered sanctioned property – assets owned by residents of states that carry out armed aggression against Ukraine.
According to these documents, the State Property Fund (SPF) will organize electronic auctions for the sale of sanctioned property in the Prozorro.Sale system, and the proceeds from its sale and lease will go to the accounts of the Fund for Liquidation of the Consequences of Armed Aggression.
“The SPF has been selling state property at online auctions in the Prozorro.Sale system for more than five and a half years, and during this time the state budget has received almost UAH 12 billion. The sale of sanctioned property through ProZorro.Sale will also allow for its transparent and competitive management in favor of the state,” said CEO of ProZorro.Sale Serhii But.
He reminded that the Cabinet of Ministers has already approved decisions on the sale of seized assets managed by the ARMA and confiscated Russian assets through the Prozorro.Sale system.
It is specified that participants in the auctions for the sale of sanctioned assets will be able to participate in them by registering through one of the platforms accredited in the Prozorro.Sale system, the current list of which is always available on the website, where all information on online auctions for the sale of sanctioned assets will be posted.
The function of the state electronic trading system Prozorro.Sale is to ensure that no one can interfere with the bidding process, that everyone has equal access to the auction, and that anyone can follow online auctions in real time, the release says.
Prozorro.Sale is 100% state-owned and subordinated to the Ministry of Economy, and operates an electronic trading system that hosts online auctions for the sale of public assets. For more than seven years of operation, Prozorro.Sale online auctions have helped to raise more than UAH 80 billion to the budgets of various levels.

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“Ukrnafta” resumes gas sales at auctions

PJSC “Ukrnafta” in November-December 2022 has resumed sales of natural gas at the exchange auctions.
“In November-December, the company sold 17.1 million cubic meters of blue fuel on the platform of the Ukrainian Energy Exchange,” the company said in a press release on Thursday.
Besides, “Ukrnafta” also intensified its work at the market of natural gas supplies to the final consumer, the PJSC noted.
As Ukrnafta director Sergii Koretsii (who took over from Oleg Gez on November 10, 2022) said in an interview with Interfax-Ukraine in late December 2022, the company plans to sell its own gas reserves in the underground storage facilities in the total volume of over 500 mln cubic meters at the exchange and/or through direct contracts.
According to him, Ukrnafta also plans to actively enter the market of natural gas supplies to end consumers.
“Just for the sake of understanding, the company used to have only five customers under direct contracts. Now we plan to become a reliable long-term partner both for large industrial enterprises and for businesses that need small volumes,” said Ukrnafta’s director.
As reported, Ukrnafta in 2021 reduced oil and condensate production by 0.1% compared to 2020 – to 1.499 million tons, gas – by 0.9% – to 1.117 billion cubic meters, but increased the production of liquefied gas by 1% (1.2 thousand tons) – to 117.7 thousand tons.
On November 5, 2022, the Supreme Commander in Chief decided to confiscate Ukrnafta shares (except for the controlling interest in Naftohaz Ukrainy) as state property during the martial law. Before the seizure, the structures of Ihor Kolomoyskyy and Hennadiy Boholyubov owned about 42% of Ukrnafta shares.
“Ukrnafta owns 85 special permits for production of hydrocarbons. On its balance sheet there are 1809 oil and 153 gas wells. The company owns 537 gas stations, of which 449 were in operation at the end of December 2022. The rest were either damaged as a result of military operations or are located in the temporarily occupied territories.

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Over seven days of daily auctions by NPC Ukrenergo for distribution of access to a cross-section for exporting electricity to Romania, the price of a cross-section increased to UAH 106 million.
Including, according to the results of the auction on July 6, the seventh day after the opening of exports to Romania, 8 winners of the auction, who divided the daily cut, must pay a total of UAH 19.8 million.
The highest cross-section price at this auction was the price at 23:00 – UAH 10.9 thousand UAH/MWh, which was shared by DTEK Zakhidenergo (by 60 MWh), Latest Technologies 3000 (by 15 MWh). h), ERU Trading (by 14 MWh), Energoatom (by 10 MWh) and Smart Trade Energy (by 1 MWh). The absolute record of the week is still the price of 11.67 thousand UAH/MWh. At the same time, experts note that traders in many positions are ready to pay for a cross-section significantly higher than the selling price of a resource in Romania for these hours.
In general, this time, as in previous auctions, more than half of the daily capacity was bought by DTEK Zakhidenergo (for export, a total of 1,377 MWh out of a possible 2,400 MWh per day).
“Le Trading” Ukraine bought a section for export of 281 MWh, “ERU Trading” – for 220 MWh, “Energoatom” – for 239 MWh (yesterday it was only 30 MWh), “Latest Technologies 3000” – by 198 MWh, Nexttrade by 45 MWh, Smart Trade Energy by 24 MWh and DE Trading by 16 MWh.
Once again, the state-owned Ukrhydroenergo participated in the auction without results.
Also, Artlex-Energy and Ukr Gas Resource did not buy anything in this auction.
From Romania on July 6, the section was not reserved.
The section to Poland continues to be purchased at daily auctions in addition to the 147 MW capacity purchased at the monthly auction of DTEK Zakhidenergo – as of July 6, at 65 MW per hour (1560 MWh per day).
According to yesterday’s scenario, the daily cross-section to Moldova on July 6 was divided by Energoatom, which bought out a cross-section for export of 9400 MWh per day and Ukrhydroenergo – by 2400 MWh per day. Another 1 MW per hour (24 MWh in total) was bought by Energy Lab Ukraine, which had not previously participated in the auction.
The section price at all auctions, except for exports to Romania, is 0 UAH/MWh.
As reported, the import-export of electricity to Romania for 100 MW started on June 30. The number of auction winners varies from 5 to 9 participants.
On June 27, ENTSO-E agreed to start commercial exports of the first 100 MW to Europe. First, the resource will be supplied to Romania, then the directions to Slovakia and Hungary will be opened, but in general, the export capacity is 100 MW. In a month, Ukrenergo expects an increase in exports.

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The Ukrcement Association has asked Ukrzaliznytsia to take into account the specifics of the cement industry when distributing wagons at auctions, as well as to reduce the use of specialized cement wagons for the transportation of other goods in high season, Chairman of the association, Pavlo Kachur said in an exclusive interview with Interfax-Ukraine.
According to him, among the urgent problems with the distribution of wagons, in particular, the lack of cement cars for transporting cement due to their use for the transportation of crushed stone and other bulk materials, and inappropriate offers at auctions in terms of the number of wagons.
Cement producers lose to grain producers, power companies, crushed stone producers in routing. They are profitable clients for Ukrzaliznytsia. They load 40 wagons in one place, bring them to the port, a power plant or an open area, unload and this is the end of the work. And they tell us: bargain, there are wagons. But cement consumers have their own specifics, which we ask to also take into account. We have only a few consumers for 20-30 wagons. Basically three or five wagons are ordered, but such offers at auctions are not enough,” Kachur said.
In addition, until September 2021, Ukrzaliznytsia put up 170 cement carriages for sale per day exclusively for the shipment of cement, but in September-October this restriction was canceled and 80 cars were put up for the transport of bulk cargo.
“On October 21, 2021, Ukrzaliznytsia also canceled this division of cement cars by type of cargo, which caused a speculative jump in the railway tariff due to increased demand from shippers of bulk materials, while leaving cement producers without wagons for transporting cement. After all, cement, in contrast to other bulk materials can only be transported by cement wagons,” the chairman of Ukrcement said.

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Within the framework of large and small privatization for May-June 2021, more than 100 auctions are planned in Ukraine, said Deputy Head of the President’s Office Kyrylo Tymoshenko.
“At the end of April this year, President Volodymyr Zelensky unlocked large privatization in Ukraine. This is without exaggeration a historic event. Firstly, it will give new life to unprofitable property, and secondly, it will attract billions of dollars in investments. It’s time to turn unprofitable ballast into profit for the Ukrainian budget,” he wrote on his Facebook page on Tuesday.
Tymoshenko said that privatization is now a separate topic of conference calls in the President’s Office.
The next meeting was held on Monday, May 17, with the participation of representatives of the State Property Fund of Ukraine (SPF) and regional state administrations.
“The key thing in our joint work is that large and small privatization in Ukraine is transparent. For the first time in the history of Ukraine, there is a political will for this. The process is already irreversible,” the deputy head of the President’s Office wrote.
He recalled that in 2020 the SPF planned to receive UAH 400 million from privatization. Despite the quarantine, the real income was several times higher – UAH 2.5 billion.
Tymoshenko is convinced that large and small privatization in 2021 opens the way for even larger investments.
At the same time, according to him, the competition is growing. In April 2020, the average number of participants in the auction was 3.67, in April 2021 it was already 4.57.