According to private economists and an Economy Ministry official, who requested anonymity to discuss the ministry’s confidential analysis, said Brazil’s trade surplus this year is on track to fall short of the US$81.5 billion forecast in early August. However, he added that it could still surpass last year’s record surplus of US$61.4 billion.
Market expectations had hovered around a US$70 billion surplus since April, according to the median forecast in a weekly central bank survey of economists, but the outlook has narrowed in the past month to around US$66 billion last week.
Leonardo Costa, an economist at Asa Investments, said strong fuel imports will force him to revise down his earlier estimate of a US$72 billion surplus this year. “Brazil is not only a major oil exporter, but also very dependent on its (imported) derivatives,” he said.
The Economy Ministry will update its trade balance forecast in early October.
“Exports are growing as expected. Last year we exported US$280 billion, this year it will probably be US$350 billion […]. What is increasing is imports,” said the source at the ministry, attributing this to rising fuel and fertilizer prices.
According to Rafaela Vitoria, chief economist at Banco Inter, the slowdown in Chinese construction is also affecting demand for iron ore, further weighing on Brazilian exports.
However, Brazil may see some relief in energy imports in the second half of this year, compared to late 2021, when a drought affected hydropower generation an increase in natural gas imports.