Brazilian trade balance records US$ 1.12 bn deficit in January

For the second year in a row, the Brazilian trade balance registered a negative result in January. Last month, the country imported US$ 1.125 billion more than it exported.

Exports totaled US$ 14.808 billion in January, against imports of US $ 15.933 billion. Despite remaining in the red, the balance improved compared to January 2020, when the trade deficit registered US$ 1.684 billion.

Both sales and foreign purchases grew compared to January last year. Brazil exported 12.4% more according to the daily average criterion. Imports grew at a slower pace: 8.3%.

The increase in exports, however, was insufficient to reverse the deficit in the trade balance. With the end of exports from the previous harvest and the planting of the new harvest, January saw fewer shipments of grains and other foods. Agricultural exports fell 2.6% in January compared to January last year, driven by rice (-99.9%), soy (-94.9%), and raw cotton (-3.6%).

Other agricultural products registered growth in January, such as unground wheat and rye (332.8%); unground corn, except sweet corn (54.3%); and unroasted coffee (43.2%). The increase in sales, however, was insufficient to reverse the drop in food exports.

The other product categories performed positively. Extractive industry exports rose 35.3% in January compared to the same month in 2020, driven by iron ore and concentrates (73.6%) and copper ores and concentrates (70.3%). Sales in the manufacturing industry increased by 6%, with emphasis on sugars and molasses (46.1%) and soybean meal (40.1%).

Imports

On the imports side, agricultural purchases grew by 22.3%, extractive industry purchases increased by 7.6%, and manufacturing industry purchases increased by 6.5%. The highlights were soybeans (whose external purchases increased by 487.4% in January compared to the same month last year), wheat and rye (35.14%), natural gas (60.1%), and organic and chemical fertilizers (42.7%).

Last month, the Ministry of Economy’s Foreign Trade Secretariat announced that the trade balance should end the year with a surplus of US$ 53 billion. The value would represent an increase in relation to the US$ 50.99-billion surplus registered last year but is below the estimates of financial institutions. According to the Focus bulletin, a weekly survey released by the Central Bank, market analysts project a trade surplus of US$ 55 billion for 2021.

Source: Agência Brasil

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