Economy

Full 2020 data published – import volumes help Brazil confirm strong V-shaped COVID-19 recovery

Jan, 31, 2021 Posted by Ruth Hollard

Week 202104

Datamar has published its full 2020 numbers and the end result shows that, despite the COVID-19 pandemic, Brazilian maritime trade ended 2020 on an even keel compared to the previous year. Additionally the outlook for 2021 looks quite positive. Brazil exported actively all year, unfazed by the pandemic and driven by the dollar high that made Brazilian products more attractive abroad. Imports, of course, were badly hit after a strong first two months, but recovered from the middle of the year onwards, drawing a strong V-shaped recovery that lasted right up to December 2020.

DataLiner data released this Monday, February 1st, shows that November and December imports reached all-time highs. Not only were these the best months on record for Brazilian imports. They also led Brazil to record an overall container trade growth in 2020 compared to 2019, up 34.346,64 TEU, which represents an 0,67% increase.

Brazilian Imports via Container | Jan to Dec 2019 – 2020 | TEU

Source: DataLiner

 

Even with the year-end recovery, Brazil’s trade balance for 2020 showed it imported 5.26% less in containers than in 2019 and 0.80% less than in 2018:

Comparison of Brazilian Imports | Jan to Dec 2018-2020 | TEU

Source: DataLiner

 

Exports were favored by the high dollar which made Brazilian products more competitive abroad. Year-to-date, exports grew 5.7% compared to 2019.

Brazilian Exports via Container | Jan to Dec 2019-2020 | TEU

Source: DataLiner

 

Comparison of Brazilian Exports | Jan to Dec 2018-2020 | TEU

Source: DataLiner

 

Trade Imbalance and Rocketing Freight Rates

The graph below shows the trade imbalance of Brazilian container imports and exports in 2020, peaking in the middle of the year, between June and July. This mismatch between supply and demand continued as the Christmas season approached and was seen not only in Brazil, but the in the main tradelanes around the globe. The resulting shortage of containers led to  sky-rocketing freight rates, which are yet to come down to more normal levels. “From what can be seen in conversations with market players, this imbalance might continue for a few more months, and continue to bring challenging conditions to market players,” says Datamar’s CEO, Andrew Lorimer.

 

Trade Imbalance | Jan 2017 to Dec 2020 | TEU

Source: DataLiner (To request a DataLiner demo click here)

 

Outlook for 2021

With potentially the worst of the economic crisis over, the prospects for this year are positive. Brazilian trade is expected to grow, and the dollar is expected to remain at a high level – the expected apprecation of the Real has not happened.

In the meantime A.P.Moller-Maersk is one of the companies that is optimistic. In its new trade report released in January, the company expects growth of 3.5% in exports and 7% in imports this year.

According to the predictions of the International Monetary Fund (IMF), the Brazilian economy should grow 3.6% in 2021.

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