São Paulo – Revenues from Brazil’s exports to Arab countries shrank in 2015, but export volumes went up, and the same holds true of total Brazilian foreign trade numbers. According to data made available by the Ministry of Development, Industry and Foreign Trade (MDIC) and organized by the Arab Brazilian Chamber of Commerce, exports to Arabs fetched USD 12.1 billion in 2015, down 9.57% from 2014. Export volumes climbed 10.1% to 44.1 million tons.
Arab Chamber CEO Michel Alaby believes last year’s results reflect the falling prices of commodities, which should remain low this year. He said Middle East and North Africa countries are jumping at the chance to stock up and to get better prices from suppliers. That is why volumes increased.
Alaby claims that in 2016, Brazil could perform better on the export front than it did in 2015. The reason is that last November, Saudi Arabia, Qatar and Kuwait have lifted their bans on Brazilian beef, which had been in place since November 2012. These countries’ combined imports could bring an additional USD 230 million a year to Brazilian exports, as per estimates from the Brazilian Beef Exporters Association (Abiec).
To Alaby, business owners can accrue higher earnings in 2016 by betting on finished goods exports, since the current exchange rate makes Brazilian products competitive overseas. Regarding Arab countries, he said there are opportunities available to manufacturers of footwear, cosmetics, medical equipment, agricultural machinery, and furniture. “Business owners will be obliged to strive to export more and more so they can maintain their industrial output. I believe this is the time for finished goods,” he said, while remarking that basic goods are “essential” items in Brazil’s export portfolio.
Value
In 2015, the number one Arab importer of Brazilian goods was Saudi Arabia. According to the MDIC, Saudi imported USD 2.7 billion worth of products from Brazil, up 8.19% from 2014. Poultry sales accounted for close to half that number, at USD 1.3 billion.
The United Arab Emirates came second at USD 2.5 billion, down 12% from 2014. Poultry and sugar comprised the bulk of UAE’s imports. Egypt, the third leading importer, spent USD 2 billion on Brazilian goods, down 11.1% from 2014. Top-selling products to Egypt included beef, cereals and pulses, such as soybean, and sugar.
Algeria, Oman, Morocco, Qatar, Bahrain, Iraq and Tunisia round out the list of top ten Arab importers of Brazilian products. Out of these, only Iraq and Tunisia increased their spending, while all the others spent less last year than they did in 2014.
Volumes
Oman was the main importer in volumes. From the 11.07 million tons imported by the Gulf country, 10.9 million tons were of iron ore, an increase of 6.2% over 2014. Brazilian mining company Vale has a plant in the country and sends ore to be processed in this plant before it’s distributed in the region and to Asian countries.
The UAE were the second largest client in volume, with imports totaling 6.8 million tons, or 19.2% more than in 2015. In volume, the main product exported by Brazil to the UAE was iron ore, followed by sugar, oxides and hydroxides of aluminum and poultry.
Saudi Arabia, which led imports in value, was the third largest purchaser in volume. The Saudis bought 5.6 million tons in products from Brazil last year, an increase of 6% over 2014. Iron ore, cereals and oilseeds, sugar and poultry were on top among the products imported by the Saudis.
Egypt, Bahrain, Algeria, Morocco, Qatar, Tunisia and Iraq complete the list of the ten largest importers in volume. Tunisia and Iraq increased their purchases in 42.7% and 329.5%, respectively. In both cases, the increase was driven by purchases of sugar.
Imports
Brazilian imports of products from the Middle East and North Africa slipped 37.5% in value and totaled USD 7.1 billion last year. The trade balance in 2015 was positive for Brazil in USD 4.99 billion, an increase of 253.3% over 2014. The amount accounts for around a quarter of the surplus posted by the country last year. Trade flows in the period totaled USD 19.2 billion, a decline of 22.4% over the performance of the previous year.
Saudi Arabia was Brazil’s largest supplier among Arab countries, with sales that totaled USD 1.9 billion, especially fuels. Sales from the Saudis to Brazil tumbled 42.2% in comparison to 2014.
Algeria was Brazil’s second largest supplier, with USD 1.8 billion in exports, or 37.5% less than in 2014. The main product shipped by Algerians was also fuels. Qatar was the third largest exporter in value to Brazil, with sales that totaled USD 960.5 million and that increased 44.5% over 2014. From this total exported by Qatar, fuels accounted for USD 469.7 million, with fertilizers accounting for USD 450 million.
December
In December, Brazil’s exports to Arab countries totaled USD 1.1 billion, a drop of 0.94% in comparison to December 2014. In volume, exports totaled 4.1 million tons, an increase of 16.6% over December 2014, according to date from Mdic. Imports from the Arab countries totaled USD 544.7 million, a drop of 40.3%. In volume, it totaled 1.5 million tons, or 0.6% less than the previous year.
*Translated by Gabriel Pomerancblum and Sérgio Kakitani
