By Ben Tavener, Senior Contributing Reporter
RIO DE JANEIRO, BRAZIL – Brazilian export targets for 2012 are set to be missed for the first time since they were first introduced in 2003 due to a crash in the global price of iron ore, one of Brazil’s key exports. With sales from January to August totaling US$160.5 billion, the government has admitted the US$264 billion target for the year is unlikely to be met.
The Ministério do Desenvolvimento (Ministry of Development, MDIC) was hoping for a 3.1 percent increase in exports from the US$254 billion total last year.
The goals for 2010 and 2011 were more than amply met, but no formal target was set in 2009 when the global financial crisis was, at the time, at its worst.
A marked decrease in demand for commodities – sales of which have buoyed the Brazilian economy in recent years – has translated into a crash in their global market price, particularly in iron ore, which has fallen 20 percent since the start of the year.
This is contributed greatly to the 24 percent fall in Brazilian exports, or a loss of US$6.1 billion in potential sales.
Exports to China have fallen considerably, jeopardizing the modest recovery that Brazil could witness in the coming months. Exports to other countries, however, notably those to African countries, have been rising.
Record sales of commodities – including iron ore, soya and petroleum products, as well as meat (particularly beef), coffee and orange juice – had previously brought strong growth to the Brazilian economy in recent years, and helped Brazil to a 7.5-percent increase in the economy in 2010.
However, last year saw growth of just 2.7 percent, and forecast for this year stand currently at around 1.65 percent, according to economists and the Banco Central (Central Bank). The government believes 2013 will buck this trend and see growth of four percent or more.
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