Ukraine industrial output drops 1.3% yoy in September

Ukraine’s industrial output dropped 1.3% yoy in September,
accelerating from a 0.5% decrease in August amid continuing declines in
manufacturing and utilities, the State Statistics Service reported on Oct. 23.
Seasonally adjusted output remained at the previous month’s level (vs. a 0.7%
m/m decline in August).

In 9M18, industrial output increased 1.8% yoy (vs.
2.2% yoy growth in 8M18).

Mining output rose 0.7% yoy in September (after 2.3%
yoy growth in August). In particular, coal production surged 13.2% yoy while
oil and gas production advanced 6.4% yoy. Meanwhile, iron ore production
dropped 3.2% yoy.

September manufacturing output declined 1.6% yoy (from
a 0.5% yoy decrease in August), mostly owing to a drop in machinery (-4.5% yoy)
and metallurgy (-1.3% yoy). Meanwhile, food industry output inched up 0.3% yoy
(from a 1.0% yoy decline in August).

Output in utilities declined 3.9% yoy (after a 6.4%
yoy drop in August).

Regionally, growth was strongest in the Sumy (41.7% yoy),
Ternopil (4.9% yoy) and Zaporizhia (4.4% yoy) regions. Declines were steepest
in Odesa (-14.0% yoy) and Volyn (-10.31% yoy) regions and the city of Kyiv
(-6.3% yoy).

Evgeniya Akhtyrko: Ukraine’s
industry performance is disappointing. Hopefully, the food industry’s recovery
will help to stop the decline in overall industrial output in 4Q18.

Our 2018 forecast of 4.6% yoy growth is subject to
downward revision.