Brazil: exports value grows 31.4% in January

RIO DE JANEIRO, BRAZIL – The value of Brazilian exports grew 31.4% in January. It was led by commodities, whose volume rose 17.4%, against 6.8% of non-commodities, as informed today (18) the Brazilian Institute of Economics of Getulio Vargas Foundation (Ibre/FGV), in releasing the Foreign Trade Indicator (Icomex).

Commodities had a 63% participation in the total value exported by the country, while non-commodities participated with 90% of imports. In the case of prices, exported commodities increased 13.6%, lower than the 18% registered by non-commodities.

By sector of activity, there was an increase in the volume exported by agriculture and cattle-raising (91.3%), followed by the transformation industry (16.3%), while the extractive industry showed a drop of 13.4%. The prices of exports rose 30.1% in the farming and livestock sector and 20.1% in the transformation industry, with a 2% reduction in the extractive industry.

The trade balance for January closed with a deficit of US$214.4 million, according to an announcement by the Ministry of Economy. Since 2009, when commodities began to explain more than 50% of national exports and China took the position of primary purchasing market, the balance was only in surplus four times in January. Last year, the balance showed a deficit of US$ 219.8 million. Last January, China lost points to the United States. Commodities are agricultural and mineral products traded on the international market.

CHINA

China continued to lead Brazil’s main export markets, with a 21.5% share, followed by the United States, with 11.6%. In January 2021, however, these percentages were 27.7% for China and 9.5% for the United States. Ibre explains the result of China as a result of the low growth rate of exports (1.9%) to that market, between January 2021 and 2022, compared to the United States, whose increase in the same period reached 59.4%. Argentina remained the third main export destination, with a share of 4.8% and a growth of 24.2%.

The drop in the value exported to China is associated with the 6.3% retraction in exports in volume to that country between January 2021 and 2022. The variation in prices for this market was positive (7.8%). For all the other markets, the exported volumes and the values increased. Brazilian exports grew 53.2% to the European Union, 33.4% to South America (except Argentina), and 35.9% to Asia, excluding China and the Middle East.

The main product exported by Brazil in January was oil, with a 27.4% variation in value. China was responsible for 41.9% of the product’s purchases but registered a 17.7% drop compared to January 2021. The United States, with a 12.6% share, increased its purchases by 192%.

The second main export product was iron ore, which registered a drop in total sales (33.7%) and China (44.1%).

Soy exports, the third main national product, increased by 5,224%. For China, whose share in the total was 80%, the variation was 13,990%. It was an expected result, explained Ibre, “because, exceptionally last year, soybean shipments were delayed”.

Besides the increase in oil purchases, the United States increased by 1,052% the purchases of beef, which had restrictions in January 2021, by 33% the purchases of coffee, and by 340% the purchases of iron and steel semi-manufactures, says the Icomex report.

IMPORTS

Brazilian imports in January this year rose 30.9% in value. In terms of prices, there was a 32.4% expansion and a 1.4% drop in volume, explained by the behavior of non-commodities. The volume index of this aggregate fell 4.2%, and prices increased 30.8%. Non-commodities explained 90% of the imports to Brazil in January.

The sector of activity in imports highlights the extractive industry in terms of volume (86.1%) and prices (110.3%). Among the main selling markets to Brazil, only China and the United States increased the volume imported by 13.7% and 3.5%, respectively. In the analysis by value, the variation was positive in all markets, but less than 10%, while for China, it was 47%, and for the United States, 61.5%. The difference is explained by the variation in import prices (29.1% for China and 55% for the United States).

In imports, the Ibre highlighted the increase of 66% in the price of fuel oil, the main product of the tariff, followed by liquefied natural gas (LNG), which increased 531%. In both cases, the United States is the leading supplier, accounting for 61.4% of Brazil’s fuel purchases and 81.4% for LNG, with a growth of 809%.

The Ibre researchers point out that the presidential election scenario in Brazil, associated with the existing tension between the United States, Russia, and China, and the appreciation of the dollar against the real, may cause revisions in the trade balance throughout the year. The only possible certainty for them is that, with the growth forecasts of the Gross Domestic Product (GDP, the sum of all goods and services produced in the country) of Brazil below 1%, the volume imported should not recede, and the value will depend on prices in the world economy. “This, on the assumption that new effects of the pandemic (of covid-19) are not present,” they warned.

With information from Agência Brasil