From the Newsroom
São Paulo – Following a slump of 18.6% in footwear exports from Brazil last year and despite a first half of 2021 filled with uncertainty due to the pandemic, the industry is expecting exports to grow by 13% this year. The figures were present during an online event about scenario analysis hosted by the Brazilian Footwear Industry Association (Abicalçados) last Thursday, 15.
Exports account for 14% of the sales and were down 18.6% in 2020 to 93 million pairs, the worst number in almost four decades. As for the footwear production, it was down 18.4% in 2020 to 764 million pairs, returning to 2006 levels.
In 2021, the industry starts to recover, although it’s expected to end the year with production levels below pre-pandemic numbers recorded in 2019. So said Abicalçados Market Intelligence coordinator Priscila Linck.
According to Linck, even by growing by around 12% in 2021, the footwear industry production should, at best, end the year 7% smaller than in 2019. “We expect the first half to be more difficult, and an upturn could take place in the second half of the year,” he said.
In the first two months of the year, the industry grew by 1% from a year ago. “Probably due to stock replacement from sales in late 2020, as domestic sales slumped by 20% in the period,” she explained.
As for exports, driven by the real depreciation against the dollar, they are expected to grow by around 13% in 2021. Just like production, though, exports could end the year below pre-pandemic levels, down approximately 6% from 2019.
During the event, it was pointed out the role played by the international and domestic crisis on the results of footwear industry, which has been more impacted than the average converting industries, and it was said Brazil could take longer to get out of the crisis, specially if compared to some of its main competitors in the footwear industry such as China. The domestic market accounts for over 85% of the industry’s sales, and the current high unemployment rates and the Brazilian household debt make the upturn more difficult.
Translated by Guilherme Miranda