RIO DE JANEIRO, BRAZIL – For the first time in forty years, basic products accounted for over half of Brazilian sales abroad.
The result, obtained in 2019, was disclosed by the Ministry of Economy. Last year, exports totaled US$224.018 billion, of which US$118.180 billion (52.75 percent) were basic goods. In 2018, the figure was 49.81 percent.
Products classified as basic are those that do not have technology involved or finishing, such as minerals, fruits, grains and meat.
According to the Ministry of Economy, exports of basic goods dropped two percent last year, while foreign sales of industrialized products dropped twice as much (10.3 percent).
Among the industrialized products, exports of manufactured goods fell 11.1 percent last year to US$77.452 billion, representing 34.6 percent of the total. Foreign sales of semi-manufactured products retreated eight percent to US$28.378 billion (equivalent to 12.7 percent of the total).
Semi-manufactured products are those that have undergone some processing but generally are not in their final state, such as pulp, raw sugar, and leather. Manufactured products typically have more embedded technology, such as electronics.
According to the Foreign Trade Secretary of the Ministry of Economy, Lucaz Ferraz, the increase in exports of higher added value, i.e., industrialized products, is a goal of Bolsonaro’s government.
According to analysts, Brazil needs to increase the export of these products as this may help generate employment and income, in addition to providing higher revenues and profits for producers.
Lowest surplus in four years
The Brazilian trade balance had a surplus of US$46.674 billion for the whole of 2019, the lowest in four years. There is a surplus when a country’s exports exceed imports.
The positive result represents a 19.6 percent drop compared to 2018, when it reached US$58.033 billion (revised value).
The retreat of the surplus happened in a context of lower economic growth as well as of world trade. In addition, Brazilian foreign trade suffered the consequences of the economic crisis in Argentina, an important market for Brazilian products, and the trade war between the United States and China.