Business news from Ukraine

UKRAINE AND LIBYA AGREE ON EXPORT OF MILK

The State Service on Food Safety and Consumer Protection has agreed with Libyan experts on the form of an export veterinary certificate for the supply of milk and dairy products, the State Food Service said in a press release.
“Less than two weeks ago, a very productive meeting with the Charge d’Affaires of Libya in Ukraine, Adel Benissa, took place at the State Food and Consumer Protection Service, and today we have very good news for Ukrainian dairy producers about the opening of the export market,” head of the agency Vladyslava Mahaletska said.
She clarified that the possibility of exporting sunflower oil, grain, fruit and berry products from Ukraine to Libya is being considered. The forms of international veterinary certificates for the export of cattle, poultry and products from it have already been agreed.
As reported, Ukraine in April agreed with Argentina the form of an export veterinary certificate for the supply of milk and dairy products to this country.
Ukrainian agricultural products in 2020 gained access to the markets of 12 countries. Some 35 export certificates have been agreed, two EU audits have been passed concerning state control over the production of fish, poultry and products made of them.
According to the State Consumer Service, in 2021, work continues to expand exports in various commodity items, including poultry, livestock, beef and pork, milk and dairy products, honey, apples, blueberries and cherries, legumes, onions, wheat flour, fish and fish products, reproductive material.

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UKRAINIAN GOVERNMENT PROPOSES THAT SUNFLOWER SEEDS EXPORT BANNED FROM MAY 15

The Ministry for Development of Economy, Trade and Agriculture of Ukraine has proposed that a zero quota is set for the export of sunflower seeds from May 15 through September 30, 2021.

The draft resolution has been posted on the ministry’s website.

In an explanatory note to the document, the ministry said that the introduction of a temporary licensing regime and quotas for the export of sunflower seeds at 0 tonnes will stabilize prices for this product in the domestic market.

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GRAIN ASSOCIATION: UKRAINE CAN INCREASE GRAIN EXPORT TO CHINA BY 3 TIMES

The Ukrainian Agrarian Confederation and the working committee of China’s Association of Small and Medium-sized Enterprises signed a memorandum of cooperation for the development of bilateral cooperation in the agricultural sector, the Ukrainian Grain Association (UGA) reported on its website on Tuesday, which also joined the signing of this document.
“Today, in the current grain season, Ukraine has exported to China about 10 million tonnes of grain, potentially could increase the export rate by 2-3 times over time. The bulk of grain exports to China accounts for corn and barley. And it is necessary to sign the appropriate interstate phytosanitary protocols to open the Chinese market for Ukrainian wheat, sorghum, peas and other crops,” the press service said, citing President of the Ukrainian Grain Association Mykola Horbachev.
According to the association, the parties will jointly create a Chinese-Ukrainian Council for International Cooperation in Agriculture, in particular for the development of modern agricultural trade and industrial park projects.

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UKRAINE WILL EXPORT MILK TO ARGENTINA

The Foreign Ministry of Ukraine and the State Service on Food Safety and Consumer Protection have agreed with the relevant authority in Argentina on the form of an export veterinary certificate for the supply of milk and dairy products to this country, the service said in a press release.
“We are making every effort to provide Ukrainian companies with new opportunities for doing business and exporting their goods. Thanks to this work, Ukrainian producers have gained additional access to the large Argentinean market, where more than 40 million people live,” Ukrainian Foreign Minister Dmytro Kuleba said.
According to the service, in order to export to Argentina, Ukrainian dairy producers must be accredited by the National Service of Agri-Food Health and Quality of Argentina (SENASA). The Argentine side allowed, in connection with the COVID-19 pandemic, to conduct accreditation of production facilities of Ukrainian enterprises remotely, followed by a physical inspection of production facilities after the normalization of the epidemic situation and the restoration of international air traffic.
The head of the agency, Vladyslava Mahaletska, specified that the opening of the Argentinean market for Ukrainian dairy products is an important step towards strengthening trade ties between the countries. She recalled that the form of veterinary certificates for the export of collagen and gelatin has already been agreed with Argentina, while Argentine poultry, fish and seafood, fresh beef will be imported to Ukraine.
“Opening the market for the export of dairy products will expand our cooperation and create new opportunities for Ukrainian producers,” she said.

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UKRAINE MAY LOSE EUR 700 MLN FROM DECREASE IN EXPORTS OF METAL PRODUCTS DUE TO SOME RESTRICTIONS

Ukraine may lose EUR 700 million due to restrictions on the supply of Ukrainian metal products as part of the introduction by the European Union of the Carbon Border Adjustment Mechanism (CBAM), according to a study by the information and analytical center GMK Center presented at a roundtable devoted to the impact of CBAM on the metallurgy of Ukraine held on April 9.
According to the press release, early March 2021, the European Parliament approved a resolution introducing the Carbon Border Adjustment Mechanism (CBAM). The European Union regards the CBAM as a special fiscal instrument that will force manufacturers of imported products to pay the same price for CO2 emissions that European producers pay. The official proposal for CBAM from the European Commission is expected to appear by the end of the second quarter of 2021. CBAM is planned to be in effect no later than 2023.
According to the study conducted by analysts of GMK Center, the negative impact on the metallurgy of Ukraine from the introduction by the European Union of the CBAM can reach EUR 700 million, or 0.5% of the gross domestic product compared to 2019.
“The metallurgical industry of Ukraine will be one of the most affected as a result of the introduction of CBAM. This will happen due to our close partnership with the EU. After all, domestic metallurgists supply 26% of marketable products to the European market, which is more than to our domestic market. Our competitors do not have such a high dependence on the EU market. The introduction of the CBAM will mean a decrease in the competitiveness of Ukrainian exports, losses for the domestic economy, a rupture of production chains between European and Ukrainian enterprises,” Director of GMK Center Stanislav Zinchenko said.
According to him, the annual export losses of Ukrainian metallurgy from the introduction of CBAM by the European Union are estimated at EUR 155-200 million per year, depending on the scenario. It will also reduce the financial results of the industry by EUR 105-200 million per year.
The CBAM covers about EUR 2.5 billion of metallurgical exports per year. The exact scale of damage to national producers depends on the form of implementation of the CBAM.
As a result of the effect of the carbon tax, one can expect a decrease in the volume of pig iron production by 500,000 tonnes (2.5% down compared to the level of 2019) and long products (including square billets) by 110,000 tonnes (1.4% down).
According to Chief Analyst at GMK Center Andriy Tarasenko, this could also lead to a decrease in the volume of capital investments in the amount of up to EUR 130 million per year (12% down compared to the level of 2019). In the long run, this will mean chronic investment lag and a competitive disadvantage.
“The CBAM should not be applied to Ukraine, since we have already taken on the goals of the European Green Deal. The exclusion of Ukraine from the CBAM, on the contrary, will be an incentive for the Ukrainian economy,” Zinchenko said.

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UKRAINE RAISES EXPORT OF COKE BY 6.7 TIMES

Ukraine in January-March this year increased exports of coke and semi-coke in quantity terms by 6.7 times compared to the same period last year, to 48,970 tonnes.
According to statistics released by the State Customs Service, in monetary terms, exports of coke and semi-coke increased by 14.2 times over this period, to $11.880 million.
At the same time, main exports were carried out to Turkey (52.68% of supplies in monetary terms), Bosnia and Herzegovina (12.58%) and Kazakhstan (12.28%).
Ukraine in January-March 2021 imported 84,895 tonnes of coke and semi-coke, which is 2.4 times more compared to January-March 2020. In monetary terms, imports increased by 2.5 times, to $21.141 million.
The products were mainly imported from the Russian Federation (57.24% of deliveries in monetary terms), Poland (24.37%) and the Czech Republic (14.53%).

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