São Paulo – Brazilian footwear exports is seen to end 2024 declining by 5-9.7% in volume, due to reasons that include the rebound in Chinese exports. The Asian country posted a decrease in sales to the United States, Europe, and Asia last year, but gained a foothold in Latin America, Arab countries, and Africa, thus bolstering Brazil’s competition in these regions.
The Brazilian Footwear Industries Association (Abicalçados) reported on Tuesday that the increase in Chinese footwear exports in 2023 was at 7% to Latin America, 8.1% to Arab countries, and 17.6% to Africa. Shipments were down by 21.6% to the US, 3.7% to Europe, and 1.9% to Asia. All in all, China exported a 2.5% lower volume.
Abicalçados market intelligence coordinator Priscila Linck said that despite the significant reduction in exports from China to the US – whose consumption is still lower than pre-pandemic levels – the Asian country has redirected part of its exports to other regions around the world.
“[China] has increased, or resumed, its share, even more rapidly in peripheral countries. This heavily impacts our exports to Latin America, which accounts for half of the footwear volume exported by Brazil, but also our domestic consumption,” she said.
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According to Linck, the Chinese footwear market’s uptake has been going on since last year. She says that Brazil gained global prominence in 2021 and 2022 due to the zero-COVID policy in Asia and the rise in international shipping prices that made the Asian shoes more expensive. The Chinese had been returning slowly to the global market, but this has changed after the pandemic.
Despite the decline in Chinese sales last year, it was smaller than the global decrease in footwear exports at 8%. “As China sees a lower decline compared to the world’s, it gains market share in exports,” she explains.
Chinese shoe exports started the year posting good volume numbers. In the first quarter of 2024, China stepped up its exports by 5.5% in volume compared to the same period in 2023. A decline of 5.4% was seen, though. The average price of the product shipped was 10.4% lower. Abicalçados consultant Marcos Lélis said there is a clear Chinese strategy to lower prices to gain market.
In a scenario where China goes hard into the international footwear exports as it did before the pandemic, Brazilian footwear exports is expected to decline. Shipments from Brazil are expected to stay below pre-pandemic levels. “But it has adjusted to more normal international levels, which have seen a rebound from Asia,” says Linck. In Q1 this year, a decline of 28% was seen already in footwear exports compared to the same period of 2023, but the reduction is expected to slow down over the year.
Brazilian footwear production
The Brazilian footwear production, though, is expected to increase by 0.9% to 2.2% this year, Abicalçado says. In January and February an increase of 9% was seen in manufacturing. As exports decline and the output increases, a larger number of shoes made by the national industry is bound to remain in the domestic market, which has seen increased income and declining unemployment.
Translated by Guilherme Miranda
