Business news from Ukraine

Kyiv KBC increased its production volume by 13%

The volume of marketable output of Kyiv Cardboard and Paper Mill (Kyiv KBC, Obukhiv, Kyiv region), the leader of the Ukrainian industry by this indicator, amounted to UAH 3 billion 673.5 million in January-June 2023, which is 13.2% more than in the same period of 2022.

According to the statistics of the UkrPapir association provided to Interfax-Ukraine, in physical terms, the mill’s production of corrugated boxes increased by 30.4% to 108.24 million square meters. Cardboard output increased by 16.5% to 81.58 thousand tons, due to a 27.2% increase in production of containerboard to 66.91 thousand tons, while boxboard output decreased by almost 16% to 14.67 thousand tons.

On its Facebook page, the mill also reported that the installation of an automated Versor machine for gluing silicone and tear-off tape to produce a new type of product has been completed at the corrugated packaging production facility. Installation of folding and gluing line equipment is underway to expand production capabilities.

At the same time, according to “UkrPapir”, the production of base paper for sanitary-hygienic products, keeps negative dynamics: in January-June it decreased by 30.5%, to 21.08 thousand tons, while the production of toilet paper in rolls decreased by 29%, to 120.08 million pieces.

Despite the decline in toilet paper production, the mill maintains its leadership in its output in Ukraine. In general, for the first half of the year the main enterprises of the industry in Ukraine produced more than 289 million rolls (6% less).

As previously reported, the mill earlier noted that the market of sanitary-hygienic products in Ukraine has decreased by 18-35%, taking into account the general state of the economy, population reduction.

According to the data of the profile association, received from the main industry enterprises, in January-June 2023 in Ukraine recorded an increase in production of paper and cardboard by 9.8% (260.55 thousand tons), as well as by 18.3% – cardboard boxes (239.31 million square meters).

Kiev KBC is one of the largest enterprises in Europe for the production of cardboard and paper products with a staff of more than 2.5 thousand people.

As reported, in 2022 the mill produced UAH 7 bln 432 mln – 3.5% less than in 2021.

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Wheat production in Ukraine to reach 26.5 mln tons – NASA Harvest

NASA Harvest (Food Security and Agriculture Program) analysts, based on satellite analysis, forecast total wheat production in Ukraine in 2023 marketing year at the level of 25-26.5 million tons, of which 21-22 million tons will be harvested on the territory controlled by Kiev, another 4.1-4.4 million tons – on the temporarily occupied territories, the official website of NASA Harvest reports. According to satellite analysis, wheat yields will average 4.27 tons/ha for the whole of Ukraine, in particular 4.53 tons/ha on the controlled territory and 3.3 tons/ha on the occupied territory.
According to NASA Harvest, wheat acreage for the whole country is estimated to be between 5.8-6.2 million hectares, of which 4.6-4.9 million hectares in the controlled territories, 1.2-1.3 million hectares in the temporarily occupied territories.
“Overall, this year’s wheat production estimate is close to last year’s due to a smaller sown area and higher yields compared to last year, which will be slightly below the five-year (pre-war) average of 27.9 million tons. This assumes that all the wheat sown will be harvested and that satellites cannot provide information on who harvested the wheat and whether Ukraine will benefit economically from its fertile farmland,” NASA Harvest summarized.
Source: https://nasaharvest.org/news/farming-warzone-nasa-harvest-releases-satellite-based-ukraine-wheat-production-estimates

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Ukrainian steelmakers reduced production of total rolled products in January-June

Ukrainian metallurgical enterprises in January-June this year reduced the production of total rolled steel, according to operational data, by 41% compared to the same period last year – to 2.375 million tons.
According to the association “Ukrmetallurgprom” on Saturday, in the first six months of this year, steel production fell by 37.7% compared with January-June 2022 – to 2.829 million tons.
Cast iron production during this period decreased by 37.5% to 2.836 million tons.
As reported, Ukraine in 5M-2023 decreased the production of rolled steel by 47.8% over the same period last year – to 1.982 million tons, steel by 43.7% to 2.392 million tons, and cast iron by 43.9% to 2.350 million tons.
Ukraine in 2022 reduced the production of total rolled products by 72% compared to the previous year – up to 5.350 million tons, steel by 70.7% – to 6.263 million tons, cast iron by 69.8% – to 6.391 million tons.
In 2021, the company produced 21.165 million tons of cast iron (103.6% by 2020), 21.366 million tons of steel (103.6%), 19.079 million tons of rolled steel (103.5%).

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Ferrexpo’s pellet production decreased 2.3 times

Mining company Ferrexpo plc with assets in Ukraine in January-June this year produced 1.967 million tons of pellets, which is 2.3 times less than in the same period last year (4.797 million tons).
The company said Thursday that pellet production in the second quarter of 2023 was up 18 percent from the previous quarter, but down 48.9 percent from the second quarter of 2022 to 1.066 million tons.
In 2023, only pellets with 65% iron content were produced.
At the same time, the total production of commercial products (pellets and iron ore concentrate) in the first half of this year decreased 2.27 times to 2.126 million tons compared to the first half of 2022. Including the output of commercial concentrate in January-June 2023 amounted to 160 thousand tons (19 thousand tons in January-June 2022).
The press release explains that Ferrexpo continues to produce, transport and sell its products under war conditions, with associated energy and logistical constraints. Meanwhile, the group has successfully operated two pellet production lines, the second of which was re-commissioned earlier this year.
The emphasis in production is on producing pellets with a higher iron content of 65% Fe or higher. Sales continued to be exported by rail and barge to Central and Eastern Europe and the Black Sea. Sales for the quarter totaled 1.2 million tons, up 45% from the previous quarter and 2.1 million tons in the first half of 2023.
The Group intends to continue using one to two pellet lines through the end of the year, as it did in the first half of the year, provided there are no further significant changes in the operating environment and logistics availability in Ukraine.
Acting Executive Chairman Lucio Genovese noted in his commentary that despite incessant shelling and multiple challenges, the company has been able to adapt its business. In particular, a second pellet line returned to production in the first half of 2023, increasing flexibility and the ability to rebuild production. However, logistics remain limited.
“Although we now have the ability to produce more, we do not currently have enough alternative Black Sea ports to export more,” Genovese stated.
He also reported that “during the first six months, we continued to maintain a strong cash position while funding our capital commitments.”
“We continue to evaluate alternative supply routes in the near term, and we are looking to the post-war future, developing plans to restore capacity so that we can return to full production levels and play our part in rebuilding Ukraine,” the top manager summarized.
As reported, Ferrexpo produced 6.053 million tons of pellets in 2022, down 46% from 2021. At the same time, pellet production in the fourth quarter of 2022 decreased by 86% compared to the fourth quarter of 2021, and by September-December 2022 decreased by 50% to 417,000 tons.
Production of premium pellets with 65% iron content in 2022 was 5.7 million tonnes (down 47%), including 417 thousand tonnes in the fourth quarter (down 28% quarter-on-quarter and 86% year-on-year). Direct reduction of iron pellets (DRI, 67% iron) output last year was 353 thousand tonnes (down 18% q-o-q), which was not produced in Q4-2022.
No pellets with 62% iron content were produced in 2022.
At the same time, total production of commercial products (pellets and iron ore concentrate) in 2022 decreased by 46% to 6.177 million tons, in the fourth quarter, compared to the third, by 49%, and by Q4-2021 – by 85%, to 457 thousand tons. Last year’s output of marketable concentrate fell by 47% to 124 kt, including 40 kt in Q4-2022 (down 38% q-o-q and up 3% q-o-q).
Total annual sales in 2022 were 6.2 million tons, down 46% from 2021.
Poltava GOK has four pellet production lines.
Ferrexpo is an iron ore company with assets in Ukraine.
Ferrexpo owns 100% of Yeristovsky GOK LLC, 99.9% of Belanovsky GOK LLC and 100% of Poltava GOK PJSC.

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“Zaporizhkoks” increased blast furnace coke production by 30.8%

Zaporizhkoks PJSC, one of Ukraine’s largest producers of coke products, a part of Metinvest group, in January-June this year increased blast furnace coke production by 30.8% y-o-y, to 426.8 thousand tons from 326.3 thousand tons.
According to the company data, in June 2023 it produced 71.1 thousand tons of blast-furnace coke, whereas in June 2022 it was 68.4 thousand tons (4% increase).
“Zaporizhkoks” in 2022 decreased the production of blast-furnace coke by 11.9% compared to 2021 – to 737.4 thousand tons, including 70.8 coke produced in December.
“Zaporizhkoks” produces about 10% of coke produced in Ukraine, owns a full technological cycle of processing of coke products. It also produces coke gas and pitch coke.
“Metinvest is a vertically integrated mining group of companies. Its major shareholders are SCM Group (71.24%) and Smart Holding (23.76%) that jointly manage the company.
Metinvest Holding LLC is the managing company of Metinvest group.

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“Ceramic Masses of Donbass” resumed production

Ceramic Masses of Donbass LLC (Slavyansk, Donetsk Region) resumed production, the company’s press service said.
“It was a very difficult road to recovery: damaged equipment, a lot of destruction, destroyed electricity/gas lines, inability to access raw materials, but we managed,” the company’s official Facebook page reported.
It is specified that a limited line has been resumed for the time being, semipharmonic mass PFF-3 is already available, once the production processes are set up, the offer will be expanded.
According to opendatabot, LLC “Ceramic Mass of Donbass” was founded in 2007, the authorized capital – 45 million 579 thousand UAH. The founders are PrJSC Ukrainian Ceramic Group (24%) and Dutch World Ceramic Investments B.V. (76%).

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