Ukraine industrial output slides 0.3% in November

The decline of
Ukraine’s industrial output slowed to 0.3% yoy in November from 5.0% yoy in
October, the State Statistics Service reported on Dec. 23. Seasonally adjusted
output increased 1.5% m/m in November. In 11M20, industrial output dropped 6.2%
yoy.

Manufacturing output
fell 3.4% yoy in November (after a 6.6% yoy decline in October). In particular,
the decline in machinery plummeted to 15.3% yoy (vs. 18.6% yoy in October),
chemical production fell 13.4% yoy (vs. 1.9% yoy growth in October), and food
production dropped 5.4% yoy (vs. 7.2% yoy in October). At the same time, the
output in metallurgy jumped 8.2% yoy (vs. a 3.3% yoy decline in October).

Mining output inched
up 1.8% yoy (vs. a 2.5% yoy slide in October), driven by a surge in iron ore
production of 10.6% yoy. At the same time, coal production fell 3.6% yoy and
oil & gas production dropped 3.1% yoy. The supply of electricity &
natural gas advanced 10.0% yoy after a 1.8% yoy decline in October.

Regionally, the
steepest declines were observed in the Chernivtsi (-25.4% yoy), Rivne (-20.3%
yoy), and Ivano-Frankivsk (-15.2% yoy) regions. Meanwhile, ten out of 25
regions posted growth in industrial output. It grew the most in
Ukraine-controlled Donetsk (20.7% yoy), Odesa (13.4% yoy) and Zhytomyr (7.8%
yoy).

Evgeniya Akhtyrko: The decline of industrial output
cooled off significantly in November. It was mostly due to the advance in iron
ore and metals production, driven by renewal of external demand, as well as the
low comparative base effect.

At the same time,
the machinery sector remains deeply depressed, chemical production has failed
to demonstrate consistent improvement, and the decline in food production is
continuing despite strong household consumption.

If the improvement
in iron ore and metals production continues, Ukraine industry might post a
slight growth in December, landing industrial output at 5.5% decline in 2020.