São Paulo – The textile and garment production sector ended the first month of 2009 with a trade balance deficit of US$ 47.2 million. Imports totalled US$ 66.9 million in textile products, against US$ 19.8 million exported. Despite the favourable exchange rates, the results for January do not yet reflect, following the exchange logics, the reduction of imports and the growth of exports.
To give an idea, China – the main Brazilian import market -, shipped to the country, in the first month of the year, 48.6% more textile products and garments than in the same period in 2008.
According to figures supplied by the Sinditêxtil-SP, the growth in imports, despite the crisis, is the result of contracts closed six months ago. Therefore, purchases made before the crisis had their products shipped in November and clearance took place in January. The union believes that this growth should drop in coming months.
With regard to the halving of São Paulo state exports, the explanation is the recession in the United States and the protectionist measures promoted by Argentina, the two main destinations for Brazilian textile product exports.
According to Rafael Cervone, the president at the Sinditêxtil-SP, after the crisis China started adopting a price reduction strategy as a way to keep exporting. "Brazil is one of the focuses for this production flow. We expected lower imports, but we may have a surprise with regard to the volume in coming months. In turn, other countries are adopting protectionist measures to make harder the entry of foreign products, with protectionist measures against Chinese sales," said Cervone. "Our exports have already felt this barrier. All import licenses have been stopped in Argentina for 60 days," he added.
The figures
In January, São Paulo state exports of textile products and garments presented a 49.03% reduction in terms of value and 49.01% in volume, when compared to the same period last year. The main reductions affected textile fibres (- 54.28%), thread (-42.46%), filaments (- 59.40%), fabrics (- 60.97%), thread (- 66.04%) and garments (- 46.64%).
Imports, when compared to the month of January 2008, presented 11.36% reduction in terms of values and fell 29.76% in volume. Despite the general reduction, some imported products posted growth, among them garments (+ 50.41%), and bed, table and bath linen (+ 16.08%).
*Translated by Mark Ament
