East Coast South American container imports nose dive in first half

East Coast South American container imports fell 39% in June of 2020 compared to the same period last year, according to DataLiner data released on Monday, August 3rd. “We haven’t seen such a low volume since July 2009, when we were still recovering from the 2008 global financial crisis,” says Datamar CEO Andrew Lorimer. “These figures reflect the impact the Covid-19 pandemic is causing in the world economy,” he adds.

ECSA imports by country | Jan 2019 to Jun 2020 (TEU)

In addition to the fall in demand from companies for imported products and equipment, the appreciated exchange rate has also hit imports hard. On the other hand, it benefits exports. Despite this, restrictions on Brazilian exports can hurt the economy. China recently suspended the authorization of several Brazilian slaughterhouses due to cases of Covid-19 and is carrying out tests with other commodities imported from Brazil, such as soybeans. This is a point to be aware of and monitor for possible further impact in the future.

ECSA exports by country | Jan 2019 to Jun 2020 (TEU)

Despite the falling economy, shipowners and the maritime transport segment, in general, have been able to balance supply and demand. The reduction in operational capacity, with the adoption of blank sailings and cheaper fuel, has led shipowners to maintain the level of freight and profits at a reasonable level, a positive point that is reproduced in all other links in this chain, such as OTIs and terminals.

Fall in imports expected to continue in July

The tendency is that this fall in imports will continue in July, since according to trade balance data released on August 3 by the Ministry of the Economy, Brazil had a trade surplus of US$8.1 billion in the seventh month of the year – the highest for all months since the ministry´s record-keeping began in 1989.

In the accumulated total for January-July, the Brazilian balance had a surplus of US$30.4 billion, above the US$28.1 billion seen in the same period last year.  For the whole of 2020, the Ministry of the Economy forecasts a surplus of US$55.4 billion, above the US$48.1 billion dollar mark reached last year, an estimate that was updated in June.