Uruguay: industry continued to outperform and chained its seventh expansion in a row

RIO DE JANEIRO, BRAZIL – The Manufacturing Industry Physical Volume Index (IVFIM) for November, published by the National Statistics Institute (INE), registered a variation of 21.1% compared to the same month in 2020. It is the seventh monthly improvement in a row in the 12-month accumulated period. In addition, the Index of Hours Worked per Worker (IHT) showed an increase in the same period of 5.1%, and the Index of Employed Personnel (IPO) of 4.5%.

The numbers are not equal according to the periods considered. Taking the average annual variation between January to November 2021 and the same interval of the previous year, the IVFIM improved 12.4%, the IHT 7%, and the IPO 5.3, while the average variation of 12 moving months up to November was for the same indicators of 11.3%, 5.7%, and 4.2%, respectively.

Likewise, discounting the effect of the refinery, the industry’s physical volume had a year-on-year increase of 18.2%.

For the November versus November comparison, the divisions that led the reactivation were food products manufacturing (which grew 16.5%), oil refining (108.9%, i.e., more than doubling), and paper and paper products manufacturing (34.3%). On the other hand, food continued to lead for the average of the year and the 12-month accumulated. Still, its escorts are not the same, with the powerful irruption of the growth of motor vehicle manufacturing.

CPA-Ferrere economist Nicolás Cichevski detailed that the industrial core grew 13% in his Twitter account. The figure dragged positive variations for the tenth consecutive month in year-on-year terms.

The Economic Situation Observatory of the Catholic University of Uruguay (UCU) of October had stated that “the recovery of industrial activity is unquestionable” even though “the trend towards savings in the use of the labor factor, which used to fall more and now grows less than the physical volume of production, is maintained”. That is to say, when production contracted, labor fell to a greater extent, and now that the volumes produced are rising, employment has increased to a lesser extent.

RISING PRICES

Up to October, the Export Price Index (IPE) of goods in dollars rose 13.2% over a year ago. For the industrial sector, the increase was 20.2%, according to the monthly report of the Chamber of Industries of Uruguay (CIU).

The IPE of the industrial sector stood at its highest level since 2015, and its year-on-year growth is the steepest in at least ten years.

Relative to 12 months ago, Uruguayan exports enjoyed higher prices by 21.4% for food, beverages, and tobacco; 18.8% for textiles, clothing, and leather; and 16.6% for chemicals and plastics.