Brazilian Footwear Industry Grapples with Export Decline Amid Surging Asian Imports

The Brazilian footwear industry finds itself caught in a trade imbalance trend since last year. According to the Brazilian Association of Footwear Industries (Abicalçados), exports are on a downward trajectory, while the influx of foreign footwear, particularly from Asia, is steadily increasing.

In the first quarter of 2024, Abicalçados reports that 27.65 million pairs were shipped, generating $253.4 million. This marks a decline both in volume (-28%) and revenue (-22.8%) compared to the same period last year.

Looking specifically at March, exports totaled 9.27 million pairs and $83.73 million, representing drops of 20.5% and 22.9%, respectively, compared to March 2023.

Meanwhile, imports surged during the same period. Brazilian Footwear Industry data shows that Brazil imported 10.32 million pairs of shoes worth $125.44 million, reflecting increases of 4.4% in volume and 12% in revenue compared to the first quarter of 2023. In March alone, imports totaled 3.4 million pairs and $34.86 million, showing increases of 49.7% and 38.4%, respectively, compared to March 2023.

The following chart shows the surge in footwear imported from Asia to Brazil. The data below was gathered through the DataLiner maritime intelligence service.

Footwear Imports from Asia | Jan 2021 – Feb 2024 | TEUs

Source: DataLiner (click here to request a demo)

Haroldo Ferreira, Abicalçados’ executive president, emphasizes that these results are driven by declining shipments to the United States and Latin American countries, traditionally significant markets for Brazilian footwear.

“At the same time, Asian manufacturers are gaining traction in these markets,” he notes. Ferreira highlights that while the decline in shipments to the United States is less severe than in previous months, challenges persist regarding domestic consumption in that country. “However, our most pressing setback has been in Argentina, our second-largest international market,” he adds.

Rio Grande do Sul continues to lead the way as the primary state of origin for exports. In the first quarter, 8 million pairs left factories in Rio Grande do Sul, generating $122.63 million. This represents decreases of 15% in volume and 12.4% in revenue compared to the same period in 2023.

In terms of imports, Vietnam emerged as the top source in the quarter, supplying 2.86 million pairs worth $59.6 million. This reflects increases of 19% in volume and 7% in revenue compared to the same period last year. China and Indonesia followed suit, with significant increases in volume and revenue.

Additionally, Abicalçados observed a notable surge in footwear imports from Cambodia and Myanmar, both of which tripled their exports to Brazil during the same period.

Overall, imports of footwear components, such as uppers, heels, soles, and insoles, totaled $10.9 million for the quarter, marking a 52% increase compared to the same period last year. China, Paraguay, and the United States were the primary sources of these imports.

Source: ABC Mais

Click here to read the original piece: https://www.abcmais.com/economia/invasao-asiatica-afeta-exportacoes-calcadistas-no-primeiro-trimestre-do-ano-entenda/amp/

Sharing is caring!