Industrial output increases 0.6% in August

Ukraine’s industrial output increased 0.6% yoy in
August, accelerating from 0.2% yoy growth in July, the State Statistics Service
reported on Sept. 22. Seasonally adjusted output declined 0.6% m/m in August.

In 8M21, industrial output increased 1.7% yoy (vs. a
6.5% yoy decline in 8M20).

Manufacturing output increased 2.2% yoy in August (after
a 1.8% yoy decline in July). In particular, metallurgical output increased 5.4%
yoy (vs. 8.4% yoy growth in July), machinery output advanced 5.1% yoy (3.8%
yoy). At the same time, the output in food industry declined 4.8% yoy (vs. a
19.2% yoy decline in July), chemicals production declined 5.6% yoy (-5.8% yoy),
pharmaceuticals production plummeted 33.4% yoy (+13.7% yoy).

Mining sector production dropped 2.5% yoy in August
(vs. a 4.0% yoy increase July). In particular, iron ore production declined 6.7%
yoy (+13.3%), coal production dropped 9.9% yoy (-8.1%), oil and gas production
slid 1.6% yoy (-2.1%).

The supply of electricity and natural gas inched up
0.3% yoy (vs. 2.2% yoy growth in July).

Regionally, the highest industrial growth in August was
in Odesa (27.5% yoy), Zaporizhia and Zhytomyr regions (both 8.0% yoy). Output
declined in 11 out of 25 regions. It dropped the most in Ukraine-controlled
Luhansk (-37.9% yoy), Kirovohrad (-36.5% yoy), and Cherkasy (-13.2% yoy),
regions.

Evgeniya Akhtyrko:  The
post-crisis recovery of Ukraine’s industry is very slow. Iron ore production is
in decline again, as global markets for this commodity are not booming anymore.
The upsurge in metallurgy is slowing amid stabilized external demand.

We don’t see the factors which could help Ukraine’s
industrial production to accelerate through the end of the year. We expect
Ukraine’s industrial output to increase 1.5% yoy in 2021 (vs. 4.5% yoy decline
in 2020).