Ukraine’s exports and imports were down substantially in 2022. Export value for the first 11 months of the year was down 31% and imports 21%. In weight terms the drop was even larger at 37% and 56%, respectively. This kind of development is obviously not surprising – the country’s economy is estimated to have contracted by about a third in 2022, inflation was running at about 26%, and export and import networks have been highly disrupted. Moreover in 2021, Russia and Belarus together accounted for about 12% of Ukraine’s imports and exports. After March 2022 this figure dropped to zero.
However, the remarkable thing is that trade continues and has even rebounded throughout the year. Ukraine’s trade has clearly benefitted from its border with the European Union and access to Western European logistics networks to move goods in and out of the country. This analysis looks at how the structure of Ukraine’s imports and exports have changed throughout 2022. With no end to the current war in sight, it is pointless to prepare a forecast so we will avoid making any predictions.
Overall Trade Developments
Export value is down 31% compared to 2021, but only 3% compared to 2020, while export weight is down 37% compared to 2021 and about 36% compared to 2020. Import value is down 21% compared to 2022, but almost 6% higher than in 2021. In weight terms, imports are down 56% compared to 2021, and about half of 2020 levels. Volumes already started dropping in February but reached a low point in March and April 2022. Since then, there has been a rebound, but both exports and imports remain below previous years.
Developments by Trading Partner
Figure 2 and Figure three provide an overview of the major export and import partners before and after the beginning of the war. Trade has always been very Europe focused, but on the import side China, Turkey and the US play a more prominent position. The biggest changes over the last 12 months have been a complete disappearance of Russia and Belarus as trading partners and an increase in trade with bordering and nearby European countries Poland, Romania, Bulgaria, Hungary and Slovakia. Having a border with and multiple entry points to the European Union has clearly helped to keep goods moving.
Developments by Commodity
The vast majority of Ukraine’s exports – both in terms of value and weight are of mining products (primarily iron ore), steel, and foods (primarily grains such as wheat, maize or barley, oilseeds). On the import side, the main products in terms of weight are coal, petroleum products, aluminium ores, gas, and fertilizers.
Two thirds of coal imports typically come from Russia, while a similar amount of petroleum products come from Russia and Belarus. Imports from these countries disappeared entirely after March 2022, although we note the imports from Belarus continued for a few months longer at much reduced levels.
The drop in coal imports were not replaced by imports from other regions. Most coal imported into Ukraine is for steel production and as such this development is reflected in a drop of steel exports.
Petroleum imports previously drawn from Russia and Belarus have largely been replaced with imports from other countries, specifically Lithuania, Bulgaria, Greece, Turkey, and – interestingly – India.
In 2021, Ukraine exported 69 million tonnes of food products (mainly grain and oilseeds). Over the past 10 years Ukraine grain exports were similar to Australia and important export markets include countries in the Middle East and South Asia and Africa. 2022 exports for the first 11 months were about 37% below 2021 levels, but the mix of countries have changed significantly as shown below. Turkey, Romania, Poland, Italy, Bulgaria and Hungary have taken on important roles as conduits to market to Ukrainian grain. Many of the big previous direct importers of Ukrainian grain importers in Africa and South Asia have no longer been receiving direct exports.
Imports of products other than raw materials and foods are down fairly consistently across both commodity groups and trading partners, but have generally been trending upwards in the second half of the year.
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