Ukraine industry drops 9% in May

Ukraine’s industrial production slumped 9.3% yoy in May, according to a state statistics report released on June 17. All industries, except iron ore mining (+2.7% yoy), declined through the month: machinery -18.1% yoy, chemicals -16.2% yoy, coal mining (-12.6% yoy), metallurgy -11.2% yoy, utilities -3.8% yoy and hydrocarbons (-1.1% yoy).

Alexander Paraschiy: The May industry decline was worse than we expected. To some extent, we can blame the Orthodox Easter, which added two extra days off in May to leave 10% less working days as compared to May 2012. Yet this is hardly an excuse for industrial sector, as most industries work in a continuous production cycle. The bigger picture is that the recession is much stronger that we’ve considered. We aren’t rushing to lower our industrial output projection and we’re keeping it at -1.5% yoy in 2013. However, if no revival occurs this summer, we might see industry decline by at least 2% yoy by the year end.