Brazilian exports to the US break record in 1Q23, says Amcham

Brazilian exports to the US reached a record US$8.7 billion in the 1st quarter of 2023 (1Q23), revealed a recently released study by Amcham Brasil. The group’s US-Brazil Trade Monitor report indicates an increase of 9% compared to the same period last year. The result represents almost twice the growth rate of Brazilian global exports (4.8%).

Brazilian imports from the US, which fell by 15.4% from 2022 to 2019, totaled US$ 9.7 billion, pushed down by natural gas purchases. Due to the water crisis, Brazil began 2022 by importing US$2.1 billion worth of natural gas from the US to power its thermoelectric plants, which was discontinued in the first quarter of this year.

According to the CEO of Amcham Brasil, Abrão Neto, “bilateral trade keeps showing a good performance. Brazilian exports continue to grow, following the record set last year. On the other hand, Imports saw significant increases in nine of the ten main products in the trade basket, except for oil and its derivatives.”

The report further discloses that the trade flow between the two countries in the first quarter was the second-highest on record, equivalent to US＄17.9 billion. This value only trails the performance recorded in the first quarter of 2022.

The publication also shows a sharp rise in the share of industrial goods in bilateral trade. The representativeness of these goods rose from 79.9% to 84.6% in Brazilian exports and from 74.1% to 92.5% in Brazilian imports in the comparison between the 1st quarters of 2022 and 2023.

See below a chart displaying the trends in containerized cargo trade between Brazil and the US between Jan 2019 and Feb 2023, according to DataLiner.

US-Brazil container trade | Jan 2022 – Feb 2023 | TEUs

Source: DataLiner (click here to request a demo)

Export highlights

The volume of six of the ten most exported items to the US grew, suggesting an increase in the North American demand for Brazilian products.

Some goods that experienced the most increases were semi-finished iron and steel products (+25.5%) and pig iron (+53.6%). Exports of cellulose pulp (+67.2%), civil engineering equipment (+40.7%), and fruit juices (+212.3%) also grew. In the latter case, the rise was driven by the drop in orange production in the US, which suffered from weather events and pests.

“The 15.3% increase in industrial product exports over the past quarter is worth our attention,” says Abrão Neto. Brazil saw nearly USD 1 billion in additional sales, aiding the increase in the participation share of the sector in Brazil’s export agenda.

Imports

In addition to no purchases of North American natural gas, which brought down total Brazilian imports by more than USD 2 billion, the country also reduced purchases of fuel oils by USD 543 million (-25.6 %).

All other major products that Brazil imports from the US increased, with non-electric motors and machines increasing by 16.6%, coal rising by 22.4%, chemical products increasing by 28.6% and inorganic chemicals increasing by 15.1%, and insecticides and fungicides increasing by 49.2%. These interactions validate the robust B2B and value chain trade characteristics that distinguish interactions between the two nations.

Freight modes

The Amcham Monitor brought, for the first time, information about the freight modes used in trade between Brazil and the USA. From both countries, sea freight is the most relevant export channel. Air freight is in second place, with greater representation in Brazilian imports (31.6%), especially goods with higher added value, such as medicines.

Forecast for 2023

Amcham’s forecast for 2023 is that trade between Brazil and the US will reach values close to the historical records observed in 2022. “The growth in exports and imports has been distributed in several products with relevant participation in the trade basket, which should support the dynamism of bilateral trade,” analyzes the CEO of the entity.

Only commercial exchanges of petroleum-derivate products such as natural gas should follow a different pattern from last year.

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