Ukraine’s headline CPI rose by 1.5% m-o-m in September after increasing by 0.6% in August, pushing the y-o-y tally up to 8.6% from 7.5% in August and 5.4% in July. Core inflation, which excludes administratively regulated tariffs and raw food and energy prices, accelerated to 1.7% m-o-m from 0.7% in August-July. In y-o-y terms, core inflation rose to 7.3% from 6.5% in August and 5.7% in July.

Parliament passed a bill of amendments to the Tax Code, hiking the military duty on private incomes (except compensations paid to soldiers) to 5.0% from 1.5% and expanding the underlying tax base to include selected private entrepreneurs. The bill also reintroduced a 50% windfall tax on bank profits earned in 2024, double the regular bank profit tax rate.

The Ukrainian subsidiary of NEQSOL Holding, the owner of Vodafone Ukraine (VFU), Ukraine’s second largest mobile operator, has won a privatization auction for a 100% stake in UMCC-Titanium, the largest producer of titanium ore in Ukraine. The UAH 3.9bn ($96m) sale is yet to be formally approved by the Ukrainian government.

Crude steel production in Ukraine totaled 5.9 Mt in 9M24, up 28% y-o-y, with finished and semi-finished steel output rising by 23% y-o-y to 4.8 Mt and hot metal production up 22% to 5.4 Mt. These 9M24 data imply September crude steel production of 610 kt, down 12% m-o-m but up 9.3% y-o-y. Hot metal production dropped by 3.0% m-o-m to 624 kt (+28% y-o-y), while finished and semi-finished steel output slid by 15% m-o-m to 504 kt (-3.7% y-o-y). Daily steel production averaged 20.3 kt in September, down 8.7% m-o-m and up 9.3% y-o-y.

US President Joe Biden postponed his trip to Germany, where he was expected to lead a high-level summit on further military support for Ukraine, in order to oversee the US government’s response to Hurricane Milton, the White House said. Separately, the UK government said its trade mission visited Ukraine last week to discuss the Ukrainian military’s new orders for UK weapons producers to be financed with GBP 3.5bn ($4.6bn) of UK export finance made available for Ukraine in July. According to the statement, the UK Defense Ministry has already placed orders with UK manufacturers on Ukraine’s behalf to produce air defense missiles and artillery gun barrel forgings “in order to warm up industry in preparation for further orders.”

DTEK Oil & Gas (DTEKOG) reported 1H24 net sales of $197m (-45% y-o-y), EBITDA of $126m (-23%) and net income of $56m (-14%), for an EBITDA margin of 64% (-19pp y-o-y). Net operating cash flow stood at $16m (+134% y-o-y), with a working capital charge of $73m (-36% y-o-y). Net investment cash flow totaled $18m (+64% y-o-y), yet CAPEX slid by 43% to $15m. Net financing cash outflow was close to zero as the company’s 1H24 bond coupon was settled by its parent under an agency agreement. End-1H24 cash was close to zero, vs. a mere $2m at end-2023 and $5m at end-1H23. Total debt fell by $50m y-o-y to $375m, this entire amount being the Eurobond maturing in 2026, following a scheduled amortization on Dec. 31, 2023. Net debt was thus close to total debt, dropping by 12% y-o-y. Gross Debt/EBITDA and Net Debt/EBITDA thus came in at 1.5x, down from 1.3x at end-1H23.

The Ministry of Finance placed UAH 23.0bn ($559m) of hryvnia-denominated bonds and $150m of F/X-denominated paper at a primary auction yesterday.

WSE-listed Kernel Holding, Ukraine’s largest sunflower oil producer and grain exporter, said its assets at the Odesa region port of Chornomorsk were damaged in a recent Russian drone attack, but transshipment operations were not suspended.

NBU gross foreign reserves dropped by 8.1% (-$3.4bn) m-o-m in September, to $38.9bn (-4.0% YTD), equivalent to 5.0 months of prospective goods and services imports. The official exchange rate of the hryvnia to the US dollar experienced only marginal fluctuations in September, ending the month at UAH 41.2:USD, flat m-o-m and down 7.7% YTD.

The CEO of state rail monopoly Ukrainian Railways (RAILUA), Yevhen Liashchenko, has tendered his resignation, which the company’s Supervisory Board will consider in the coming days, RAILUA’s press service said. According to media reports, RAILUA Board member Oleksandr Pertsovskyi, who heads the company’s passenger business, may become the new CEO, with other management reshuffles also possible. The outgoing CEO may return to the CFO position to focus on attracting financing to fund RAILUA’s CAPEX program.

Ferrexpo reported 3Q24 pellet production of 1.3 Mt, down 14% q-o-q but up 1.5% y-o-y, including 0.9 Mt of premium 65% pellets, 189 kt of DRI pellets, and 162 kt of pellets produced from third-party ore. Quarterly concentrate production totaled 128 kt, down 32% q-o-q but up 31% y-o-y. Total production in 3Q24 thus stood at 1.4 Mt, down 16% q-o-q and up 3.6% y-o-y, bringing 9M24 output to 5.1 Mt (+47% y-o-y).

Key highlights from last week: Russian forces continue to make small tactical gains in Donetsk and Kharkiv regions; advances towards Pokrovsk still minimal No apparent change in Russia’s Kursk region for the second consecutive week Russia sharply increases drone attacks across Ukraine, with record 1,300 drone launches reported in September and almost 300 in the first week of October

Ukraine exported 3.9 Mt of grain and oilseeds in September, down 14.6% m-o-m but up 34% y‑o‑y. Grain exports totaled 3.0 Mt, down 15.7% m-o-m but up 45% y-o-y, and oilseed exports stood at 0.9 Mt (-11% m-o-m, +6.9% y-o-y).

Baseload power on the Ukrainian day-ahead (DAHD) market averaged UAH 5,411/MWh (EUR 118/MWh) in September, little changed m-o-m and up 46% y-o-y. The average bilateral baseload price on the Ukrainian Energy Exchange (UEEX) for September supplies dropped by 0.6% m-o-m to UAH 5,022/MWh (+30% y-o-y), or 7.2% lower than the day-ahead market price. October baseload supplies are currently priced slightly higher at UAH 5,144/MWh (+2.4% m-o-m and +37% y-o-y).

According to provisional data from the Finance Ministry, the central budget ran a cash deficit of UAH 131bn in September, equivalent to $3.2bn, bringing the 9M24 gap to UAH 807bn or $20bn.

Interpipe reported 1H24 net sales of $536m (+3.0% y-o-y), EBITDA of $130m (-27%), with an EBITDA margin of 24% (-10pp y-o-y), and net income of $129m (+5%). Pipe segment EBITDA was down 44% y-o-y to $51m, while rail wheel segment EBITDA rebounded by 59% to $25m, and steel segment EBITDA declined by 23% to $54m. On a pass-through basis (without attribution to the steelmaking segment), pipe EBITDA was unchanged y-o-y at $91m, wheel EBITDA increased by 31% to $37m, and steel EBITDA dropped by 96% to $2.8m.