Ukrainian banks’ hryvnia-denominated deposits increased by 1.7% m-o-m to UAH 1,635bn in March after rising by 2.0% in February, bringing the y-o-y rate of growth to 31%. F/X deposits inched up by 0.3% m-o-m to $19.3bn (+3.3% y-o-y) after dropping by 0.7% m-o-m in February. Gross UAH loans increased by 1.9% m-o-m and 7.1% y-o-y to UAH 747bn in March, while F/X loans declined by 1.2% m-o-m and 8.6% y-o-y to $6.3bn.

The European Commission (EC) has endorsed the Ukraine Plan, a program of reforms that underpins the EU’s EUR 50bn 4-year Ukraine Facility aid package comprising EUR 38.3bn of budgetary support (incl. EUR 6.0bn of emergency financing and EUR 5.3bn of grants), EUR 7.0bn of investment support, and EUR 5.0bn of technical assistance. The Ukraine Plan includes a quarterly schedule of budget support tranches and attached conditionality. It provides for EUR 12.3bn of budgetary aid in 2024, including EUR 3.4bn in grants, on top of EUR 6.0bn of bridge financing, thus bringing total prospective disbursements this year to EUR 18.3bn. The remaining budgetary financing includes EUR 12.5bn in 2025 (EUR 1.25bn in grants), EUR 5.3bn in 2026 (EUR 0.45bn grants), and EUR 2.1bn in 2027 (EUR 0.17bn grants).   The next step is for the Ukraine Plan to be approved by EU member states over the next month, which would then enable the European Commission to disburse up to EUR 1.9bn in pre-financing before proceeding to regular disbursements.

According to the latest monthly enterprise survey conducted by the Ukrainian Institute for Economic Research (IER), the share of manufacturing companies operating at 75%+ of capacity (compared to their pre-war level) stood at 58% in March, flat m-o-m, with the share of idle firms also remaining unchanged at 4%. Growing input costs remained the major obstacle for doing business, mentioned by 53% of respondents (vs. 49% in February), followed by labor deficit (50% vs. 46% in February) and security risks (46%, flat m-o-m). Power supply issues were mentioned by 40% of firms, up from 24% in February, with other impediments including supply chain disruptions, demand weakness, and complicated logistics.

Kernel Holding Commercial Director Oleksandr Golovin told a local media outlet that the company’s greenfield oilseed processing plant in Starokonstiantyniv (Khmelnytsky region, western Ukraine) has been launched and is currently operating at 50% of capacity. In other comments, Golovin said Kernel plans to procure 3 Mt of grain for export in the marketing year 2023/24, up from c. 1 Mt during the 2022/23 season but still well below Kernel’s pre-war volume of 7 Mt. Additionally, the company expects to secure 2.8 Mt of oilseeds for processing. Lastly, Kernel is restoring its damaged grain terminal in the Odesa port of Chornomorsk, expecting to bring it to full capacity by year-end. (Latifundist.com)

Ukraine’s merchandise trade deficit widened to $2.7bn in March from $1.5bn in February as imports jumped by 20% m-o-m to $5.9bn (+9.4% y-o-y) and exports fell 4.8% m-o-m to $3.2bn (-16% y-o-y).

Ukraine’s iron ore exports increased by 31% m-o-m to 3.3 Mt in March (+120% y-o-y), bringing the 1Q24 volume to 9.0 Mt (+146% y-o-y). In value terms, iron ore exports surged by 21% m-o-m to $310m in March (+86% y-o-y), totaling $0.9bn in 1Q24 (+114% y-o-y). March steel exports fell by 11% m-o-m to 296 kt (still +52% y-o-y), bringing the 1Q24 volume to 1.0 Mt (+144%% y-o-y). In value terms, monthly steel exports dropped by 3% m-o-m to $186m (+45% y-o-y) but jumped 114% y-o-y to $0.6bn in 1Q24.

Russian military command keeps its offensives concentrated in several narrow sectors in Donetsk region, achieving further small gains due to overwhelming manpower and fire superiority

Crude steel production in Ukraine totaled 1.7 Mt in 1Q24, up 37% y-o-y, with finished and semi-finished steel output rising by 36% y-o-y to 1.4 Mt and hot metal production up 32% to 1.6 Mt.

The Verkhovna Rada approved yesterday a bill of amendments to a range of laws intended to accelerate and facilitate military conscription.

Ukrainian Railways (RAILUA) CEO Yevhen Liashchenko said the company earned net profit of UAH 5.2bn ($143m) in 2023, up from a net loss of UAH 9.6bn in 2022, with half of last year’s net earnings set aside for dividends and transferred to the state budget. He also confirmed that the company remained profitable in 1Q24.

Russia conducted another coordinated missile and drone strike against Ukrainian energy assets last night, firing 42 missiles and 40 drones. The Ukrainian military reported intercepting 18 missiles and 39 drones. Civilian authorities reported attacks on power distribution, power generation and natural gas infrastructure assets in the Odesa, Kharkiv, Zaporizhya, Lviv and Kyiv regions. In particular, DTEK said two of its power plants were damaged. Another power plant in the Kyiv region was apparently hit as well.

The US Export–Import Bank has approved a $156m 15-year loan for Ukrainian Railways (RAILUA) to finance the acquisition of 40 Wabtec locomotives.

Ukraine’s headline CPI increased by 0.5% m-o-m in March after inching 0.3% higher in February but slowed on a y-o-y basis to 3.2% from 4.3%. Core inflation, an indicator adjusted for administratively regulated tariffs and prices of raw foods and energy, increased by 1.0% m-o-m, accelerating from 0.4% in February, yet slowed in y-o-y terms to 4.2% from 4.5%.

The European Parliament and the Council of the EU have renegotiated their provisional agreement to extend a duty-free trade regime with Ukraine for another year, from June 2024 to June 2025. It needs to be approved by the European Parliament and the European Council to take effect.

Naftogaz CEO Oleksiy Chernyshov said the company “will definitely repay” its debt obligations, adding that Ukrainian companies should be allowed to service their debts to investors as they need to attract funding.

WSE-listed Kernel Holding, Ukraine’s largest sunflower oil producer and grain exporter, announced that, following its repayment of pre-war PXF facilities (Natixis PXF and ING PXF) last December, it agreed with the remaining lenders to exit previously signed waiver letters and return to the original debt servicing schedule.