Business news from Ukraine

UKRAINE EXPORTS 4.2 MLN TONNES OF GRAIN IN NEW AGRI YEAR

Ukraine since the beginning of the new 2019/2020 agricultural year (July-June) and as of August 6, 2019 had exported 4.189 million tonnes of grain and legumes.
According to the Ministry of Agricultural Policy and Food, farmers exported 1.59 million tonnes of corn, 1.58 million tonnes of wheat, and 1.02 million tonnes of barley.
For the same period last year, 2.606 million tonnes of grain and leguminous crops were exported.
As of the indicated date, 27,700 tonnes of flour were also exported.
As reported, with reference to the ministry, Ukraine exported a record 50.4 million tonnes of grain in the 2018/2019 agri-year, and this is 23% more than in the previous agri-year.

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UKRAINE’S FOREX RESERVES EXPAND BY $1.2 BLN TO $21.84 BLN

Ukraine’s forex reserves in July 2019 grew by $1.2 billion or 5.8%, to $21.84 billion thanks to net purchase of currency on the interbank currency market by the National Bank of Ukraine (NBU), according to preliminary data posted on the central bank’s website.

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UKRAINIAN BUSINESSES EXPECT BETTER FOREX RATE AND SLOWDOWN OF INFLATION – SURVEY

Ukrainian businesses expect a slowdown in inflation and not so strong devaluation of the national currency, according to findings of a regular survey of business expectations, conducted by the National Bank of Ukraine in the second quarter of this year. “The average forex rate in 12 months is UAH 28.82 per U.S. dollar (the forecast given in Q1 was UAH 29.32 per U.S. dollar),” the NBU said in a document.
According to it, if in the first quarter of this year, respondents estimated inflation in the next 12 months at 9%, their forecast given in the second quarter is 7.7%.
The National Bank adds that Ukrainian companies have also improved their expectations for economic growth in Ukraine and the development of their own business, although the Business Expectations Index (BEI) for the next 12 months slid slightly to 117.8% from 119.7% a quarter earlier.
According to the survey, entrepreneurs began to better assess their current financial and economic situation – a positive response balance of 12.6% versus 8% in the first quarter. They expect to improve the situation thanks to the increase in production and sales, primarily for export. In this connection, companies plan to increase investment in equipment and more actively borrow funds.

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UKRAINE SEES 11% FALL IN FOREX EARNINGS FROM FERROUS METAL EXPORTS

Ukrainian metal companies saw a fall of 11.1% in foreign currency revenues from exports of ferrous metals in January-June 2019 year-over-year, to $4.797 billion.
According to customs statistics published by the State Fiscal Service, the share of ferrous metals of total income from exports was 19.6% compared to 23.21% from a year ago.
In June 2018 alone, receipts from ferrous metal exports amounted to $728.422 million.
In January-June 2018, Ukraine decreased imports of similar products by 4.5%, to $600.651 million including imports reaching $106.97 million in June.
In January-June 2018, Ukraine decreased metal products exports by 1%, to $534.622 million including June deliveries being $100.516 million. During this period, imports of metal products grew by 28.9%, to $528.524 million, including June imports worth $81.691 million.
As reported, in 2018 Ukraine saw its forex earnings from ferrous metal exports rise by 23.8%, to $9.937 billion. Ukraine saw imports of these products increase by 20.4%, to $1.367 billion.
Ukraine experienced a 23.8% rise in metal products exports, up to $1.11 billion. Metal imports grew by 19.9% last year, to $967.674 million.

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NATIONAL BANK OF UKRAINE CUTS FOREX PURCHASES ON INTERBANK MARKET

The National Bank of Ukraine (NBU) only purchased foreign currency on the interbank foreign exchange market during the period from June 18 until June 21, 2019 and replenished its forex reserves by $40.5 million as compared with $135.1 million last week. Some $40.5 million was acquired at the best purchase and sale price (using the matching tool), the NBU said on its website.
In total, since the beginning of this year, the NBU has bought $1.595 billion on the interbank market, including $278.3 million in June, and sold $231.43 million there (the central bank did not sell foreign currency in June).

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NATIONAL BANK OF UKRAINE COULD REDUCE NORM OF MANDATORY FOREX SALE FROM 50% TO 30%

The National Bank (NBU) could in the near future reduce the rate of mandatory sale of foreign currency earnings for exporters from 50% to 30% or cancel it completely, Deputy Governor of the NBU Oleg Churiy has said. “If we carry out another wave of currency liberalization in the near future, we will remove or reduce these restrictions. Perhaps, we will reduce mandatory sale from 50% to 30%, but this will depend on the macroeconomic situation. Perhaps, we will completely cancel it,” he said.
The NBU in the policy of gradual liberalization of the currency market focuses not on temporary restrictions but on macroeconomic indicators and possible consequences, he said.
According to the banker, the central bank considers the abolition of compulsory foreign exchange earnings for exporters to be among the priorities of currency liberalization along with the lifting of restrictions on the repatriation of dividends to foreign investors.

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