São Paulo – Brazilian exports to Arab countries went up for the third straight month in July. According to data by the Ministry of Development, Industry and Foreign Trade (MDIC) gathered by the Arab Brazilian Chamber of Commerce, sales to the region increased 3.9% over the same month of last year and generated US$ 1.2 billion in revenues to Brazil.
Exports increased a lot more, 53.8% in volume, which means that goods were shipped last month with lower prices than in July 2014. “We sold more quantity, however, revenues were lower due to drop in prices”, said the Arab Chamber’s CEO, Michel Alaby. Brazil sent to the Arab world 5.2 million tons in July of this year and 3.3 million tons in July of last year.
According to Alaby’s calculations based on the MDIC’s data, among the products traded to the Arabs with lower prices were beef and poultry. Revenues of the sales of meats in general from Brazil to the region totaled US$ 393 million in July, an increase of 22% over the same month of 2014. The volume shipped went up 32.4%.
This was the third straight month and the fourth month in the year in which Brazilian exports to Arab countries went up. It also happened in June, May and in March. Alaby believes that the July increase is a reflection of the Eid, the celebration of the end of Ramadan, the holy period of Islamism in which believers fast during the day and hold banquets after sunset.
He also believes in the impact of Hajj, which started at the end of Ramadan and continues for forty days. This is a period in which Muslims go on pilgrimage to the holy city of Mecca, Saudi Arabia, and there’s a stronger demand for food.
In the first seven months of the year, however, Brazilian sales to Arabs are still registering a decline. It has dropped 3.3% and exports revenues totaled US$ 7.05 billion. Despite the increase in four months this year, in January, February and April there was a decline in exports to the Arab market. But Alaby believes that the real devaluation against the dollar will favor sales and that the year will end with an increase of 4 to 5%.
In July, among the most sold goods by Brazil to the Arabs were sugar, meats, ore, calcined alumina, soybean and maize grains. The largest destination markets were Egypt, Saudi Arabia, Oman, Algeria and Qatar. But only Egypt, Saudi Arabia, Oman and Algeria increased their purchases in comparison to July of last year.
Brazilian imports of Arab products declined 23.4% in July over the same month of last year to US$ 887 million. In part due to lower prices of oil, reminds the Arab Chamber’s CEO. But he also lists other products that were imported from the Arab world with lower prices, such as diesel oil, urea, aviation fuel, petrochemical naphtha and superphosphate. Brazil purchased natural gas from the Arab world in July, which hasn’t happened in the same month of last year.
The Arab countries that increased their sales to Brazil were Saudi Arabia, United Arab Emirates, Qatar and Tunisia, among the tem largest suppliers. Imports from Morocco, Algeria, Iraq, Kuwait, Bahrain and Egypt declined.
*Translated by Sérgio Kakitani
