Ukraine goods trade deficit enlarges to USD 0.8 bln in March

Ukraine’s goods trade deficit amounted to USD 752 mln
in March, enlarging from a USD 270 mln deficit in February, the State
Statistics Service announced in a preliminary report on May 14. Seasonally
adjusted goods trade deficit amounted to USD 819 mln (vs. a USD 424 mln deficit
in February) amid a 1.0% m/m growth of adjusted exports and a 8.5% m/m jump in
adjusted imports.

Goods exports jumped 26.5% yoy in March to USD 5.2 bln
(vs. a 14.9% yoy increase in February). The accelerated growth was mostly
driven by exports of ferrous metals (+74.0%), mineral products (+71.7% yoy) and
machinery (+31.3% yoy). At the same time, grain exports declined 9.4% yoy.

Goods imports advanced 24.7% yoy to USD 6.0 bln in
March (vs. 1.1% yoy increase in February). The acceleration was mostly driven
by imports of vehicles (+54.4% yoy) and heavy machinery (+33.0% yoy). In
addition, food imports advanced 17.0% yoy, while imports of energy products
picked up 6.0% yoy.

In 1Q21, the goods trade deficit amounted to USD 1.3
bln (identical to the deficit in 1Q20), goods exports increased 12.0% yoy while
goods imports advanced 11.0% yoy.

Evgeniya Akhtyrko: Partially,
the strong growth of goods exports and imports is a result of the low
comparative base of March 2020. Meanwhile, a surge in exports of ferrous metals
and mineral products is also a result of an incredibly favorable price
situation on global markets. A surge in imports of vehicles is likely caused by
a new wave in the purchase of used automobiles abroad by individuals amid
another extension of tax privileges on their imports.

We expect the goods trade deficit to enlarge in
2021 as the growth of goods imports will outpace export growth. We expect that
the 2021 goods trade deficit (according to UkrStat methodology) will swell to
USD 8.3 bln (from USD 4.9 bln in 2020).