Russia became the fifth largest importer to Brazil during the war

RIO DE JANEIRO, BRAZIL – Brazilian imports of Russian products increased much faster than total foreign purchases at the beginning of the year.

As a result, the Russians, who are even at war with Ukraine, have climbed up the rankings and were the fifth country selling the most to Brazil from January to April. In the same period last year, they were still in 12th place.

From January to April this year, China remained the clear leader in terms of products shipped to Brazil, followed shortly by the United States. It was followed by Germany and Argentina.

Russia, which ranks fifth, sold a total of R$2.4 billion (US$500 million) to Brazil during this period, virtually equal in value to India, which followed shortly after.

Compared to last year, the Russians left behind countries such as South Korea, Mexico, and Japan.

Brazilian purchases from Russia increased 89% from January to April this year compared to the same period in 2021, and overall Brazilian imports rose 28% in the same period.

Experts point out that Russia’s current position among Brazil’s top five suppliers is not permanent but the result of a scenario that occurred with the pandemic and was exacerbated by the war between Russia and Ukraine.

The composition of our economic activity and the Brazilian “basket” of Russian products we buy help explain this. Fertilizers or chemical fertilizers are the main components, occupying 70% of the basket. Coal accounts for another 15% and petroleum another 7.1%.

Russia is one of the world’s largest suppliers of fertilizers and compost. From January to April, the Russians supplied $1.65 billion worth of these items, equivalent to a quarter of Brazil’s imports during that period. The value of purchases from the Russians increased 142% compared to the same months in 2021.

The increase in value was influenced by prices and expected purchases. Prices of fertilizers imported by Brazil increased by 130.7% in April compared to the same month last year.

The data come from the Secretariat of Foreign Trade (Secex/ME) and are for all the fertilizers we imported this month, but the input from Russia was also more expensive.

Data from MacroSector show that the price of Russian fertilizers purchased by Brazil in the first quarter of 2022 increased by 149% compared to the same months of 2021.

According to Fabio Silveira, partner-director of the consultancy, this price increase reflects an increase that has already taken place in 2021. Under the impact of the pandemic, fertilizers became more expensive due to increased demand, supply shortages, and logistical bottlenecks. The war has increased the fear of lack of inputs.

In releasing trade balance data for April, Herlon Brandão, undersecretary for foreign trade information and statistics at Secex, explained that, according to the agency’s survey, farmers preferred to buy these inputs, probably because of fear of shortages currently caused by the war in Eastern Europe.

With information from Valor Economico

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