Business news from Ukraine

UKRAINIAN DTEK REMAINS ONLY ELECTRICITY EXPORTER TO POLAND

JSC DTEK Zakhidenergo continues to buy out all the proposed interstate section capacity for exporting electricity to Poland at daily auctions for April, according to data on the website of NPC Ukrenergo.
According to the published results of the auction for April 2-6, the company bought 190 MW of distributed power for each hour of the day.
According to the data on the ENTSO-E website, from April 1 to April 5, exports are the same – in a flat schedule of 190 MWh all day.
As of April 6, data are not yet available.
As reported, on March 28, Ukrenergo resumed daily auctions for the purchase of interstate cross sections for the export of electricity to Poland. All import-export auctions were suspended on February 24 due to the entry of the Ukrainian power system into an isolated mode as part of synchronization with ENTSO-E.
The power systems of Ukraine and Europe switched to synchronous operation on March 16.

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UKRAINIAN EXPORTERS STARTS SENDING CONTAINERS WITH RASPBERRIES TO USA AND CANADA

Ukrainian exporters in 2021 for the first time sent one sea container with frozen raspberries to the United States and Canada. This event is important for domestic producers, since this berry is traditionally more expensive in the markets of these countries than in other regions of the world.
As reported on the website of the Ukrainian Horticultural Association (UHA) on Monday, the importance of this event for the development of production and freezing of berries in Ukraine is explained by the high level of requirements for product quality and logistics, which were successfully overcome by Ukrainian suppliers this year.
“One shipment of raspberries was sent to Canada and the United States in the amount of one sea container. The logistics took about one and a half months, and the buyer was satisfied with the quality of the supplied products and is considering the possibility of continuing cooperation with Ukrainian suppliers on an ongoing basis,” the association said.
The association said that the higher import price for berries in the United States and Canada is due to high requirements for the quality of products, for the confirmation of which Ukrainian exporters have been certified by the FDA (The U.S. Food and Drug Administration).
“The United States and Canada account for about 80% of all global imports of frozen raspberries in value terms and about 65% in physical terms. However, Ukraine has traditionally exported frozen raspberries mainly to Poland, which makes good money on the re-export of Ukrainian raspberries to other countries of the world,” the organization said, citing Economist of the Investment Department of the Food and Agriculture Organization of the United Nations (FAO) Andriy Yarmak.
According to the UHA, the United States imports frozen raspberries from Chile, Mexico and Serbia, and Canada from Chile, Serbia, the United States and Mexico.
The approximate carrying capacity of a standard 40-foot sea container is 27 tonnes.
“Accordingly, for Ukraine, which is one of the five largest world exporters of frozen raspberries, it is very important to gain a foothold in these two most important sales markets. This is especially important amid the expected growth in production of all types of berries in 2022-2024. It remains to hope that not only the volume, but also the quality of the berries produced will grow,” the association said.
According to the data on the website of the Ukrainian Agribusiness Club, in 2020 Ukraine produced 35,000 tonnes of this berry, ranking seventh in the world in terms of its production. Some 89% of this berry was grown on household farms.
Last year, Ukraine exported 539 tonnes of raspberries, which is 2% of its total production. At the same time, Poland was practically the only consumer of Ukrainian fresh raspberries.

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UKRAINE CLIMBS TO NINTH PLACE IN RANKING OF STEEL EXPORTERS IN 2020

Ukraine in 2020 reduced steel exports to 15.2 million tonnes from 15.6 million tonnes a year earlier, but rose in the ranking of exporters from the tenth to the ninth place, according to the World Steel Association (Worldsteel).
According to the report, India was ranked higher than Ukraine last year among exporters with 17.1 million tonnes, Italy closed the top ten with 14.9 million tonnes, and China is still at the top of this list with 51.4 million tonnes, followed by Russia with 31.5 million tonnes and Japan with 29.8 million tonnes.
At the same time, due to the small volume of imports, Ukraine in the world ranking of net exporters in 2020 retained its fourth place with an indicator of 13.9 million tonnes, which is only slightly less than the 2019 indicator of 14 million tonnes.
The first place here is taken by Russia with 26.4 million tonnes, the second – by Japan with 24.8 million tonnes, the third – by South Korea with 16.1 million tonnes, while China is the fifth in this list with 13.5 million tonnes.
China was the largest importer of metal last year with 37.09 million tonnes, followed by the EU-28 with 32.6 million tonnes, excluding interregional trade, and the United States came third with 19.9 million tonnes.
In the ranking of net importers over 2020, the United States is leading with 13.6 million tonnes, the EU-28 is in the second place with 10 million tonnes, and Saudi Arabia is in the third place with 7.2 million tonnes.
Worldsteel recalls that in 2020 Ukraine produced 20.6 million tonnes of steel and took 12th place, the volume of pig iron production amounted to 20.4 million tonnes. At the same time, the country exported 3.1 million tonnes of pig iron last year, and its apparent consumption amounted to 17.3 million tonnes.
Apparent steel consumption in Ukraine in 2020, according to the association, amounted to 4.6 million tonnes, while consumption per capita – 105.5 kg.

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8% OF EXPORTERS AND 19% OF IMPORTERS IN UKRAINE FACE OBSTACLES IN ACTIVITIES – SURVEY

Some 7.9% of Ukrainian exporting enterprises face obstacles in their activities, according to a survey by the Institute for Economic Research and Policy Consulting.
The rate in 2020 is the lowest since 2016, according to the study. In 2018, some 23.6% of exporters faced obstacles, while 19.3% in 2017 and 26.9% in 2016.
Large and small businesses (10.4% and 10.7%) more often report impediments to export compared to micro (8.1%) and medium (4.1%). Most often, they deal with obstacles in the implementation of exports by enterprises in the service sector (22.6%).
In Chernivtsi, Ternopil, Zhytomyr, Donetsk regions, there are no complaints about the presence of obstacles. Most often, such are reported by exporters from Rivne (22.2%), Ivano-Frankivsk (20%), Kirovohrad (20%), Sumy (20%), Poltava (18.8%) regions.
The main obstacles to export are the absence of simplified rules for determining the origin of goods (20.4%), a long wait for export clearance at customs (20.4%).
Among importers, 18.9% of the surveyed enterprises stated that they faced obstacles to their activities. This figure is also the lowest in all waves of the study since 2016. Some 28.4% of importers faced obstacles in 2018, some 29.3% in 2017 and 35.2% in 2016.
Cherkasy region is the only region where there are no complaints about import obstacles. Enterprises in Mykolaiv region most often point to impediments to imports (35.7%, every third respondent).
According to the respondents, the main obstacle to import is a lack of transparency in determining the customs value of goods that are imported (38.7%). Almost a third complain about the complexity of customs and tax legislation (32.4%). The third place in the rating of obstacles is taken by high rates of customs payments (27.5%).
The survey was conducted in 2020 by the civil society initiative “For Fair and Transparent Customs” with the support of the European Union, the International Renaissance Foundation and Atlas Network. More than 1,000 representatives of enterprises were interviewed: from micro-enterprises to large enterprises engaged in export and/or import. Most of the respondents are micro and small enterprises, representatives of industry and trade.

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UKREXIMBANK PROVIDES LOAN TO EXPORTER OF NUTS

The state-owned Ukreximbank (Kyiv) provided a EUR 500,000 loan to Nutsi LLC, which specializes in the sale of walnuts and pumpkin seeds, to export the 2020 harvest, the bank’s press service said on Thursday.
According to the bank, Nutsi has an extensive network of points to purchase nuts and seeds throughout Ukraine and exports raw materials throughout Europe.
According to the unified public register of legal entities and private entrepreneurs, Viacheslav Yanchiy is the ultimate beneficiary of Nutsi LLC, the size of the charter capital of the company is UAH 44,000.
Ukreximbank was established in 1992, the only owner is the state.
According to the National Bank of Ukraine, as of July 1, 2020, in terms of total assets, Ukreximbank ranked third (UAH 226.729 billion) among 75 banks operating in the country.

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AGRICULTURAL EXPORTER KERNEL AGAIN TOPS LIST OF LARGEST RECIPIENTS OF BUDGET VAT REFUNDS

Kernel-Trade, the agricultural exporter, tops the list of the largest recipients of budget value added tax (VAT) refunds for the third month in a row, having received UAH 1.03 billion in June against UAH 650 million in May and UAH 965 million in April.
According to the State Treasury Service, the second place on the list in June, as in May, was again occupied by ArcelorMittal Kryvyi Rih mining and metallurgical plant with almost UAH 977 million against UAH 501.45 million in April.
The top three recipients of budgetary VAT refunds also included Suntrade with UAH 681.8 million, while in April the company ranked fifth with UAH 359 million, according to the data of the State Treasury.
Mariupol-based Illich Iron and Steel Works affiliated with Metinvest Group improved its performance over the month with UAH 597.44 million against UAH 373 million in May. The top five largest recipients of budgetary VAT refunds also included Myronivsky Hliboproduct (MHP) with UAH 550 million (UAH 70 million in April).
The second five in June includes Poltava GOK with UAH 477.25 million (UAH 236.7 million). It is followed by Zaporizhstal steel plant from Metinvest Group with UAH 451.3 million (UAH 372.75 million), followed by Azovstal, which reduced its figure to UAH 289.4 million from UAH 336.45 million in May.
The top ten largest recipients of VAT reimbursement are closed by Pivdenny (Southern) GOK with UAH 283.2 million and Dniprovsky Iron and Steel Works with UAH 250.74 million.

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