Ukraine external goods trade deficit enlarges to USD 0.8 bln in July

Ukraine’s external goods trade deficit enlarged to USD
810 mln in July from USD 672 mln in the prior month, the State Statistics
Service said in its preliminary report published on Sept. 14. The seasonally
adjusted goods trade deficit amounted to USD 713 mln (vs. a USD 751 mln deficit
in June) amid 3.6% m/m growth in adjusted exports and a 2.0% m/m increase in
adjusted imports.

Goods exports fell 13.0% yoy in July to USD 3.7 bln
(vs. a 5.7% yoy drop in June). The decline was mostly driven by falling exports
of ferrous metals (-14.4% yoy) and grains (-30.3% yoy). At the same time,
chemical exports surged 48.8% yoy, while exports of food oils and fats jumped
16.0% yoy.

Goods imports fell 17.3% yoy to USD 4.5 bln in July
(vs. a 14.3% yoy decline in June). In particular, imports of energy products
plummeted 44.9% yoy, machinery dropped 22.7% yoy, and chemical imports slid
9.0% yoy. At the same time, imports of foods advanced 7.5% yoy.

In 7M20, the goods trade deficit amounted to USD 2.1
bln (vs. USD 5.0 bln in 7M19). Goods exports slid 7.4% yoy, while goods imports
dropped 14.7% yoy.

Evgeniya Akhtyrko: Ukraine’s
external trade remained very weak in July. The decline in exports of two major
items – grains and ferrous metals – is significant as a result of both lower
production volume and weaker external demand. Imports are depressed by low
prices of energy resources and the meager demand for investment goods
(machinery).

We expect the decline in Ukraine’s exports to
decelerate through the year end due to a better performance of grain exports. Goods
imports are likely to depend on the renewal of consumer demand and the
situation at Ukraine’s Forex.