São Paulo – Capital goods exports from Brazil reached USD 703 million in July, down 20.3% from June and 3.3% from July 2017, the Brazilian Machinery Builders’ Association (Abimaq) reported this Tuesday (28).
Abimaq imputed the slowdown in exports to a buildup in sales during the month of June, which was caused by a trucker strike in late May. However, the fact that sales also slid year-on-year in July is an indication that “export margins are potentially decreasing.”
Year-to-date through July, machinery and equipment exports amounted to USD 5.476 billion, up 13.9% from a year ago. “Since the crisis broke out in Brazil, the industry is working to increase foreign sales, and this caused the share of exports in total sales to go from 21% in 2013 to 46% in 2018,” Abimaq said.
But imports still outweigh exports for the industry. Nearly USD 1.4 billion worth of machinery and equipment got imported to Brazil in July, up 21% year-on-year. Year-to-date through July, imports exceeded USD 8.5 billion, up 18% year-on-year.
“Good results in imports are a reflection of orders placed in late 2017 and early 2018, at a point when the crisis was expected to end faster,” Abimaq explained. “Increased uncertainty in the last quarter of the year, combined with a weakened real (Brazilian currency) relative to the US dollar, means this trend will likely wane in months to come,” it said.
Translated by Gabriel Pomerancblum
