LSE-listed MHP, Ukraine’s largest poultry producer, reported that Saudi Agricultural and Livestock Investment Company (SALIC), a wholly owned subsidiary of the Public Investment Fund of the Kingdom of Saudi Arabia, has acquired 13,514,563 MHP GDRs on the market, equivalent to 12.6% of the company’s outstanding shares.

Power market enterprise Guaranteed Buyer has paid renewable power producers an additional UAH 978m ($24m) for August electricity supplies, bringing its settlements for the month to UAH 4.1bn, or 70.2% of the total due.

State rail monopoly Ukrainian Railways (RAILUA) reported freight transportation of 14.2 Mt in August, up 4.2% m-o-m and 16% y-o-y.

Crude steel production in Ukraine totaled 5.3 Mt in 8M24, up 31% y-o-y, with finished and semi-finished steel output rising by 27% y-o-y to 4.3 Mt and hot metal production up 21% to 4.7 Mt. The reported 8M24 data imply crude steel production in August of 691 kt, down 2.6% m-o-m but up 15% y-o-y. Hot metal production recovered by 3.6% m-o-m to 644 kt, up 21% y-o-y, while finished and semi-finished steel output was virtually flat at 589 kt (+16% y-o-y). Daily production averaged 22.3 kt in August, down 2.6% m-o-m and up 15% y-o-y.

Key highlights from last week: Russian forces still fail to advance towards Pokrovsk but make further grinding gains in nearby Donetsk region sectors Heavy fighting continues in Russia’s Kursk region, with first major Russian counterattack stopped after initial gains US, UK discuss permitting Ukraine to use their long-range missiles to strike military targets inside Russia Ukraine’s military intelligence chief says Russia aims to finish the war by early 2026

The Cabinet of Ministers has submitted to parliament a state budget bill for 2025, projecting a deficit of $36.5bn or 19.4% of GDP. The macroeconomic forecast underpinning the 2025 budget draft assumes a slowdown in real GDP growth to 2.7% y-o-y from 3.5% expected by the government this year (the latter estimate was downgraded from 4.6% y-o-y). Average annual inflation is projected to accelerate to 9.7% y-o-y from 5.4% in 2024E and the average UAH:USD exchange rate is expected to weaken noticeably, down 9.3% y-o-y to UAH 45.0:USD. Thus, the government sees 2025 nominal GDP at $188bn, up slightly from $183bn this year. The government plans to finance next year’s deficit solely with external borrowings, expecting to raise $37bn of foreign debt (no grants) and attract $2.0bn for financing investment projects. Domestic borrowings are seen at a small $0.4bn. The government estimates public debt will reach 102% of GDP by end-2025.

As of Sep. 13, Ukrainian farmers harvested 38.3 Mt of grain and oilseeds, up 9.1% y-o-y, from an area of 10.9 Mha, up 22% y-o-y and representing 54% of this year’s total cropland. With the harvest of early crops (wheat, barley and rapeseed) already finished, farmers started gathering late crops such as corn and sunflower. The Agriculture Ministry reported the current corn harvest at 1.1 Mt (+20x y-o-y), gathered from 6.3% of the planted area at an average yield of 4.3 t/ha (-7.9% y-o-y). The sunflower harvest, 30% complete, totaled 3.0 Mt (+2.9x y-o-y) or 2.0 t/ha on average (-4.5% y-o-y). Lastly, farmers harvested 34% of soybean plantings, gathering 1.8 Mt (+3.0x y-o-y) at an average yield of 2.0 t/ha (-17% y-o-y).

Ukraine exported 4.6 Mt of grain and oilseeds in August, the second month of the marketing year (MY) 2024/25 (July 2024-June 2025), up 8.8% m-o-m and 50% y‑o‑y. Grain exports totaled 3.5 Mt, down 4.5% m-o-m but up 53% y-o-y, and oilseed exports stood at 1.0 Mt (double m-o-m and up 40% y-o-y).

The NBU Council, the central bank’s supervisory body, approved the Medium-Term Monetary Policy Guidelines providing for the adoption of a flexible inflation targeting regime. The document set an inflation rate of 5% as the key NBU goal over a three-year policy horizon and detailed the operational instruments the NBU can use to reach its inflation target, including the key rate, managed exchange rate flexibility, and F/X controls. Supporting F/X market stability was described as an important task for the central bank.

In an extensive interview with a local media outlet, Metinvest CEO Yuri Ryzhenkov said that the worsening external environment and growing domestic security risks had led the company to build several scenarios for the nearest future, in each of which Metinvest assessed that it would be able to service its external debt. In view of high uncertainty, the company remains in constant dialog with its creditors but has not yet approached them with any proposals. On Pokrovske Coal, Ryzhenkov expressed his belief that the mine, located west of the city of Pokrovsk in the Donetsk region, will not be lost despite ongoing Russian offensives near the eastern outskirts of Pokrovsk. But the company responded to the deteriorating security situation by helping evacuate the families of its workers from Pokrovsk and offering them to relocate to the neighboring Dnipropetrovsk region to be able to work in shifts. In the event the mine is lost, Metinvest would buy coal from third parties, import it from Poland or the group’s own mines in the US, or import coke, yet this would increase production costs and may depress steel and iron ore production.

DTEK Renewables plans to build a 200 MW battery storage site in Ukraine by September 2025, estimating the project to cost EUR 140m.

According to preliminary data released by the NBU, state-owned Ukreximbank booked net profit of UAH 1.9bn ($47m) in 2Q24, down 24% q-o-q, bringing 1H24 net income to UAH 4.4bn ($112m), up 121% y-o-y. Total assets fell by 1.8% q-o-q in UAH terms (+2.6% y-o-y), with net loans -0.7% q-o-q (+2.2% y-o-y). Customer deposits dropped by 1.0% q-o-q in UAH terms (-2.4% y-o-y). NIM, based on net interest-bearing assets and in UAH terms, increased by 0.9pp q-o-q to 4.4% (+1.9pp y-o-y). Annualized cost of risk was positive at 0.4% due to a release of provisions, down from 5.1% in 1Q24 (2.7% in 1H24 vs 2.3% in 1H23). The total capital adequacy ratio stood at 4.2% as of end-2Q24, down 0.1pp q-o-q and 3.6pp y-o-y, but rebounded to 11.3% as of end-August, up 7.1pp m-o-m.

According to preliminary data released by the NBU, state-owned Oschadbank booked net profit of UAH 4.0bn ($114m) in 2Q24, down 19% q-o-q, bringing 1H24 net income to UAH 8.8bn ($241m), up 29% y-o-y. Total assets in UAH terms increased by 9.8% q-o-q to UAH 409bn (+38% y-o-y), with net loans up 3.8% q-o-q (+20% y-o-y) and securities holdings expanding by 9.6% q-o-q (+46% y-o-y). Customer deposits rose by 9.4% q-o-q in UAH terms, to UAH 352bn (+36% y-o-y). NIM, based on net interest-bearing assets and in UAH terms, was unchanged q-o-q at 7.8% (7.8% in 1H24, -0.1pp y-o-y). Annualized cost of risk was positive at 2.8% in 2Q24, reflecting another release of provisions (in line with pos. 3.0% in 1Q24, bringing 1H24 cost of risk to pos. 2.9%, flat y-o-y). The total capital adequacy ratio came in at 14.35%, down 1.4pp q-o-q and 2.7pp y-o-y.

President Volodymyr Zelensky met with US Secretary of State Antony Blinken and UK Foreign Secretary David Lammy during their joint visit to Kyiv yesterday, highlighting the importance for Ukraine of receiving Western allies’ permission to “use long-range weapons provided by the United States and other partners as soon as possible.” On a related note, the US and UK foreign ministers also announced c. $1.5bn in new economic and humanitarian aid for Ukraine, including to support the country’s energy infrastructure amid ongoing Russian attacks.

Fitch Ratings affirmed its Long-Term Foreign Currency Issuer Default Rating (IDR) and senior unsecured rating on Vodafone Ukraine (VFU) at CCC-.

Ukraine’s headline CPI rose by 0.6% m-o-m in August following a flat reading in July, pushing the y-o-y tally to 7.5% from 5.4% in July. Core inflation, an indicator adjusted for administratively regulated tariffs and prices of raw foods and energy, increased by 0.7% m-o-m, unchanged from July, bringing the y-o-y growth rate to 6.5% from 5.7% in June.