Page 56 - UKRRptJul24

4.0 Real Economy 4.1 Industrial production
Ukraine's industrial production increased by 11.2% in the first quarter of 2024 compared to the same period in 2023, according to data from the State Statistics Service. In March, industrial production rose by 5% year-on-year and by 6.3% month-on-month, reflecting a robust recovery in the sector.
In the first quarter, the steel industry and production of finished steel products surged by 32.3% compared to the first quarter of 2023, while metal ore mining grew by 33.4% year-on-year. This upward trend in the Ukrainian mining and metals sector has continued from the fourth quarter of 2023, supported by a low comparison base and increased utilization of iron and steel enterprises due to the reopening of sea exports for iron and steel cargo.
In March 2024, production in the steel industry increased significantly by 17.6% compared to March 2023 and by 14.6% compared to February 2024. However, iron ore mining saw a decrease of 2% year-on-year and 6.7% month-on-month.
According to the GMK Center, Ukraine's industrial production grew by 5.9% in 2023 compared to 2022. December alone saw a substantial increase of 22.6% year-on-year and 7.9% month-on-month. The steel sector and finished steel products experienced an 8% growth compared to 2022, while metal ore mining production decreased by 10.2% year-on-year.
The significant annualized growth in the steel sector in 2023 was primarily due to improvements in the fourth quarter, following a negative performance in January-September. This growth resulted from a low comparison base, as the industry faced severe disruptions in October-December 2022 due to electricity supply issues caused by Russian attacks on Ukraine's energy infrastructure.
The mining industry also showed marked improvement at the end of the year, which helped reduce the annual decline in steel production. The reopening of the sea export corridor for iron and metals cargo played a crucial role in this recovery, leading to increased utilization of steel plants.
The strong performance in the first quarter of 2024 indicates a continued recovery and resilience in Ukraine's industrial sector, driven by strategic reopening of export channels and improved operational conditions in key industries.
56 UKRAINE Country Report July 2024 www.intellinews.com