Industrial production increased in 2014

According to the preliminary data of Statistics Estonia, in 2014 the production of industrial enterprises grew 2% compared to the previous year. Production increased 4% in manufacturing, but decreased nearly 6% in mining and energy.

In the course of 2014, manufacturing production showed a moderate growth compared to the same month of the previous year. Both export sales and the sales on the domestic market increased.In 2014, production exceeded the volume of the previous year in two-thirds of the branches of industry. The growth in the production of manufacturing was positively influenced by the three branches holding bigger shares – the manufacture of electronic products grew 7%, the manufacture of wood 8% and the manufacture of food products 4%. Production increased also in the manufacture of metal products, electrical equipment, motor vehicles, refined petroleum products and machinery and equipment. Production fell in the manufacture of chemical products, furniture and building materials.In 2014, production grew mainly due to an increase in exports. 70% of the whole production of manufacturing was sold on the external market. Export sales as well as sales on the domestic market grew about 2% compared to 2013.

In December 2014, industrial production increased 8% compared to December 2013; the production of manufacturing rose 7%. In December compared to December 2013, the production of electricity increased by 23% and the production of heat by 13%.

In December 2014 compared to November, the seasonally adjusted industrial production as well as the production of manufacturing fell 1%.

Diagram: Volume index of production in manufacturing in the European Union countries

Read more from Statistics Estonia

Retail sales of goods increased 6 pct in December

// // The stable growth in retail sales continued also in the last month of the year – Statistics Estonia

According to Statistics Estonia, in December 2014 compared to December 2013, the retail sales of goods of retail trade enterprises increased 6% at constant prices. Since August, the retail sales growth has remained within a stable of 5–6% compared to the same month of the previous year.

In December 2014, the retail sales of goods of retail trade enterprises were 463.9 million euros, which was 353 euros per inhabitant.

The retail sales in stores selling manufactured goods increased 7% at constant prices compared to December 2013. Sales increased in most economic activities. Only the retail sales in non-specialized stores selling predominantly industrial goods (e.g. department stores) and in stores selling second-hand goods and non-store retail sale (stalls, markets, direct sale) were smaller than in December of the previous year. The retail sales via mail order or the Internet increased the most, with sales increasing slightly more than a fifth (22%). The retail sales increased also in stores selling household goods and appliances, hardware and building materials (9% growth), in stores selling pharmaceutical goods and cosmetics (9% growth), in other specialized stores, such as stores selling computers and their accessories, photography supplies, books, sports equipment, games and toys etc. (8% growth) and in stores selling textiles, clothing and footwear (6% growth).

The retail sales in grocery stores increased 3% compared to December 2013.

The retail sales of automotive fuel increased 10% at constant prices compared to December of the previous year, which was a significantly faster growth than in November. The acceleration in the growth in the retail sales of automotive fuel was influenced by the low reference base of December 2013 and the acceleration in the price decrease of automotive fuel. In November 2014 the annual price decrease of automotive fuel was 4.4%, while in December it was 14.1%.

In December compared to November 2014, the retail sales in retail trade enterprises increased almost by a fifth (19%) at constant prices. This is a usual rise in December when Christmas marketing takes place.

In December, the turnover of retail trade enterprises was 543.6 million euros, out of which the retail sales of goods accounted for 85%. Compared to December 2013, the turnover increased by 5% at current prices. Compared to November 2014, this indicator increased 13%.

According to preliminary data, the retail sales of retail trade enterprises were nearly 4.9 billion euros in 2014; compared to 2013, the retail sales increased 6% at constant prices.

Diagram: Retail sales volume index of retail trade enterprises and its trend


Source: Statistics Estonia

Every fifth person in Estonia lives in relative poverty

According to Statistics Estonia, in 2013, 22.1% of the Estonian population lived in relative poverty and 8% of the Estonian population lived in absolute poverty.

Social transfers (state benefits and pensions) helped to prevent falling into poverty, as had they not been included in income, the at-risk-of-poverty rate would have even been 40.7% and the absolute poverty rate 32.6%.

In 2013, a person was considered to be in at-risk-of poverty if his/her monthly equalised disposable income was below 358 euros and in absolute poverty if his/her monthly equalised disposable income was below 205 euros. In 2013, the difference in income between the poorest and richest fifth of the population was 6.6-fold.

The at-risk-of-poverty rate is highest in the case of elderly people. In 2013, 32% of persons aged 65 and over lived in relative poverty. The absolute poverty rate is highest in the case of children and young people (aged 0–24) and in the case of pre-retirement age people (aged 50–64) (10% in both age groups).

The level of education significantly affects the risk of falling into poverty. Among persons with basic or lower education, every third was in the poorest and only every twelfth in the richest income quintile. At the same time, one-third of people with higher education belonged to the richest fifth. Therefore, the at-risk-of-poverty and absolute poverty rates of persons with higher education (14.6% and 4.1%, respectively) were more than two times lower than those of persons with basic or lower education (33% and 10.4%, respectively). A higher level of education is an important prerequisite for the prevention of poverty.

The incomes of Estonians were higher than those of non-Estonians and the risk of poverty was lower for Estonians. In 2013, the at-risk-of-poverty rate of Estonians was nine percentage points lower than that of non-Estonians and the absolute poverty rate four percentage points lower. 19.5% of Estonians lived in relative poverty and 6.8% in absolute poverty, the same indicators for non-Estonians were 28.6% and 11%.

At-risk-of-poverty rate is the share of persons with yearly disposable income lower than the at-risk-of-poverty threshold, and absolute poverty rate is the share of persons with yearly disposable income lower than the absolute poverty threshold. The at-risk-of-poverty threshold is 60% of the median yearly disposable income of household members, the absolute poverty threshold is the estimated subsistence minimum. Equalised disposable income is the total household income, which is divided by the sum of equivalence scales of all household members.

The estimations are based on the Social Survey, which has been conducted by Statistics Estonia since 2004. In 2014, more than 5,800 households participated in the survey. The survey collects data about the yearly income, which is the reason why the survey of 2014 asks about the income of 2013. The yearly income is necessary for calculating the indicators of poverty and inequality. In the case of the income of 2013, the data source changed – in addition to the Social Survey and previously used databases, the data of the Tax and Customs Board were also used.

Social surveys are conducted by national statistical offices in all European Union countries on the basis of a harmonized methodology under the name of EU-SILC.

Source: Statistics Estonia

Milk production increased 4 pct

According to the preliminary data of Statistics Estonia, the production of milk amounted to 799,300 tons in 2014, which is 4% more than the year earlier. The number of dairy cows decreased by the end of the year, but milk production per cow increased.

After a small decrease in 2009, the production of milk has increased every year compared to the previous year.

On 31 December 2014, the number of cattle in Estonia was 264,800, of which 95,100 were dairy cows. Compared to the same time of the previous year, the number of cattle has increased by 1%, but the number of dairy cows has decreased by 3%. The number of dairy cows has been in decline during the last decade; it stabilised for a while, but started to decrease again in 2014. At the same time, the average milk production per cow has continually increased. In 2014, the average milk production per cow was 8,206 kilograms, i.e. 216 kilograms more than in 2013.

At the end of the year, there were 360,000 pigs and 90,100 sheep and goats in Estonia. The number of pigs remained almost the same as at the end of 2013, and the number of sheep and goats increased by 4%.

In 2014,196.4 million eggs were produced, which is 3% more than the year earlier. 118,300 tons (live weight) of livestock and poultry were slaughtered in holdings or sold for slaughter; the production of meat increased by 1% compared to the previous year. The production of beef and poultry meat increased, while the production of pork, mutton and goat meat decreased.Diagram: Milk production per cow, 1994–2014

Source: Statistics Estonia

The production of cereals broke records last year

According to the preliminary data of Statistics Estonia, cereal production was 1,221,600 tons in 2014, which is 25% more than the year before and the biggest cereal production ever recorded in Estonia.

Total cereal production included 615,500 tons of wheat, 458,100 tons of barley and 49,600 tons of rye. The average yield per hectare was 3,669 kilograms of cereals, whereas the average yield for wheat was 3,988 kilograms, for barley 3,641 kilograms and for rye 3,211 kilograms.

In 2014, the sown area of cereals was the largest in recent years. It was 332,900 hectares, 7% more than in the previous year. The sown area of wheat was 154,400 hectares, which was almost a quarter more than in the previous year. The sown area of barley decreased by 5% and amounted to 125,800 hectares in 2014. The sown area of rye was 15,400 hectares, which is one-third more compared to the previous year.

The production of legumes was 39,500 tons, which is a quarter more than the year before. The average yield was 2,070 kilograms of legumes per hectare. Legumes were sown on 19,100 hectares, which is 41% more than the year before and also the largest sown area of legumes ever.

According to preliminary data, the yield of rape and turnip rape seed was 166,200 tons. In 2014, rape and turnip rape were sown on 80,000 hectares. The average yield was 2,078 kilograms of rape and turnip rape seed per hectare.

The production of potatoes amounted to 117,300 tons, which is 8% less compared to the year before. The sown area of potatoes has been less than 10,000 hectares since 2008 – it was 6,400 hectares in 2014. The average yield of potatoes was 18,472 kilograms per hectare.

Source: Statistics Estonia

Milk farm in Estonia to lay off 75 employees

Perevara, a milk farm in Jõgeva county that has 5 production units, 100 employees and 1,300 cows announced today that it is going to lay off 75 people and close four out of its five units, leaving only 220 cows.

Read more from BBN

More express transfers are being made in Estonia

Private clients and companies in Estonia made an average of 926 express transfers* per day through TARGET2 in the fourth quarter of 2014, with a total value of 44.4 million euros. The average number of transfers per day is 2.8 times higher than a year earlier, but the total value has fallen by one tenth. This indicates that express transfers are being used more for paying smaller sums. In Estonia most of the express transfers are cross-border, as much as 80%, and on average 189 domestic payments were made each day through TARGET2 in the fourth quarter. As more than one million domestic payments are made each day in Estonia, including card payments, TARGET2 express transfers are only being used to a small extent.

Interbank transfers in Estonia became slower from February 2014 when Estonia joined SEPA, the Single European Payment Area, but it is still possible to make faster transfers if necessary. TARGET2 allows all bank clients to make high-speed transfers that reach the recipient within around 15 minutes between 08.00 and 18.00 on business days all across Europe. Depending on the bank and whether the payment is made in a bank office or over the internet, the price of an express transfer can vary in Estonia from €1.50 to €50. A general picture of the price lists of the banks can be found in Estonian at

* TARGET2 express transfers are based on the service operated by Eesti Pank, which is available to all the banks operating in Estonia.

See a graph here

Source: Bank of Estonia

Author: Teet Puusepp, Eesti Pank Payment and Settlement Systems Department

Ferry service between Sillamae and Ust-Luga reopens

After a five-month hiatus, ferry service between the Port of Sillamae in Northeast Estonia and the Russian port of Ust-Luga has been re-opened, reported ERR.

This is the only regular sea route between Estonia and Russia.The ferry that takes both cars and passengers aboard departures daily.

Read more from BBN

The housing loan portfolio grew by 2.8% in 2014

Annual growth in the portfolio of loans and leases to Estonian companies and households slowed to 2.7% in December.Growth slowed because company loan volumes were reduced, partly as a result of the reclassification of client sectors and economic units for reporting purposes. The total loan and lease portfolio of companies and households stood at 15.3 billion euros at the end of December.

New loans and leases worth 854 million euros were issued to companies in December, which was the largest monthly amount for 2014. The volumes of both short-term and long-term loans issued during the month were above their averages for the year and the largest volumes of long-term loans went to real estate companies.

The annual growth in loans and leases to households accelerated to 2.8% in December due to an increase in housing loans. In the last month of the year, 75 million euros of new housing loans were issued, which is a similar amount to that seen in the preceding months.

The average interest rate on loans issued in December was similar to that of the previous month. The average interest rate for housing loans stayed at 2.2%, where it had been in November, and the average interest rate for long-term corporate loans was 2.7%.

The share of loans overdue for more than 60 days accounted for 1.7% of the loan portfolio in December. Although there was some reduction in the volume of overdue loans in December, it was partly because of earlier write-downs.

Deposits continued to grow rapidly. The deposits of companies and households were up 7.9% over the year. The total volume of deposits grew to 203 million euros in December, 140 million of which was corporate deposits. Non-resident deposits also increased during the month.

Banks earned around 59 million euros in net profit in the fourth quarter of 2014. Net profit was pulled down by a fall in net interest income, higher personnel costs and write-downs of loans. The ratio of net profits to assets was 1.6% for the banks in the final quarter of 2014.

Source: Bank of Estonia

Author: Mari Tamm, Financial Sector Policy Division of Eesti Pank

Statoil turns to Supreme Court over alcohol sale ban

One of the largest vehicle fuel retailers, Statoil, has asked the Supreme Court for its opinion on Tallinn City Council’s ban on the sale of strong alcohol in filling stations, which is due to come into effect on July 1.

The company said the ban is unconstitutional as it goes against the freedom of enterprise, and previous rulings by the Supreme Court have said such bans are illegal.

Statoil said the ban, due in effect on July 1, should be postponed until the court has come to a conclusion.

The ban, among a number of others to limit the availability of alcohol, is part of the city’s drive against alcohol consumption.

Source: ERR News