Foreign exchange earnings from the export of ferrous metals decreased due to a decrease in export prices

The metallurgical complex has been and remains an important basic sector of the economy of the Donetsk region. In January-May 2019, enterprises of metallurgical production and production of finished metal products sold products worth 51.2 billion UAH, which amounted to 39.9% of the total sales of industrial products in the region and 28.3% of sales of products of the metallurgical complex of Ukraine (excluding temporarily the occupied territory of the Autonomous Republic of Crimea, the city of Sevastopol and part of the temporarily occupied territories in the Donetsk and Luhansk regions). From the export of ferrous metals in January-May 2019, 1.6 billion dollars were received. USA, or 83.3% of foreign exchange earnings from the export supplies of all goods by enterprises of the region and 38.5% of foreign exchange earnings from the export of ferrous metals in Ukraine.

The dynamics of metallurgical production in the region was not stable. After a significant decline in 2014–2015 (by 27.7% and 26.4%, respectively), in 2016 there was an increase of 9.0%. Subsequently, due to the blockade of freight traffic on the demarcation line, the volumes of manufactured products began to decline again. In 2017, metallurgical production and production of finished metal products in the region decreased by 7.0% compared to the previous year, in 2018 - by 3.9%. In January-May 2019, the increase over the same period in 2018 was minimal and amounted to 1.4%.

In 2018, despite a decrease in the physical volume of production, foreign exchange earnings from the export of ferrous metals increased by 16.4% compared to the previous year, which was associated with an increase in prices on foreign markets for the sale of ferrous metals. The weighted average price of a ton of metallurgical products exported by enterprises of the region increased by 18.0% compared to 2017. However, since the beginning of 2019, there has been a negative downward trend in export prices for ferrous metals. In January-May, for the enterprises of the region, they were lower than in January-May 2018, by 5.9%, as a result of which USD 97.5 million was lost. foreign exchange earnings, and the total volume of exports of ferrous metals in dollar terms decreased by 4.0%.

The development of metallurgical production largely depends on the industry's investment. In the first quarter of 2019, the enterprises of metallurgical production and the production of finished metal products of the region used UAH 1.8 billion of capital investments, which is 38.9% more than in the first quarter of the previous year. This amounted to 57.1% of the total volume of capital investments in industry (in the first quarter of 2018 - 43.3%). The share of the region's metallurgy in the investment of the metallurgical complex of Ukraine increased over this period from 29.1% to 33.0%.

In January-May 2019, at enterprises of metallurgical production and production of finished metal products