Brazilian trade with the Arab League nets US$ 6 bn surplus

Data from the Arab Brazilian Chamber of Commerce shows that trade between Brazil and the Arab League generated a US$ 6.1 billion surplus for Brazil in 2020, 12.2% of the record US$ 50-billion surplus reached by Brazil in 2020. It also represents a 16.2% increase over the positive balance of the Brazil-Arab League balance of 2019.

According to the entity, Brazilian exports to the bloc of 22 countries in the Middle East and North Africa generated revenues of US$ 11.4 billion, 6.3% below that of 2019. The fall, however, is weaker than the fall registered from other relevant commercial partnerships, such as with the United States (-23.7%) and Mercosur (-17.7%).

Export performance keeps the Arab League among Brazil’s three largest trade partnerships abroad, behind only China and the United States. It also confirms the region as the second busiest destination for agribusiness exports which make up the majority of the export basket.

Brazilian sugar was the most demanded product (revenue of US$ 2.8 billion, up 32.5% over 2019), followed by chicken (US$ 1.9 billion, -11.7%), ore iron (US$ 1.4 billion, -22.3%), corn (US$ 1.1 billion, + 3.1%), and beef (US$ 968 million, -18.2%) that was mainly exported to the United Arab Emirates (bought US$ 2 billion in 2020, 8.7% reduction over 2019), Saudi Arabia (US$ 1.8 billion, -6.7%), and Egypt (US$ 1.7 billion, -4, 0%).

To ensure access to food, the Arabs actively sought foodstuffs across the globe. The pandemic, however, caused a significant reconfiguration in trade with the region, opening new markets and changing demand in others.

Algeria, for example, bought US$ 1.1 billion in 2020, an increase of 16.2% over 2019. The North African country has historically had a surplus trade relationship with Brazil, but in 2020 the surplus favored Brazil. Morocco, which used to figure in the top ten markets in 2020, bought 43% more compared to 2019 (US$ 671.2 million) and is now in the seventh position.

Sugar was once again the product most demanded by the Arab partners, displacing chicken. Alone, the commodity was responsible for 25% of the total revenues of US$ 2.8 billion, an increase of 32.5% over 2019, indicating that the sugar-energy sector, more mechanized than its competitors in India and Thailand, managed to maintain a steady trade flow and ended up taking a larger share of the Arab market.

There was an even greater demand for soybeans (US$ 323 million, + 68.7%) and corn (US$ 1.1 billion, + 3.1%), driven by the markets in the Arabian Gulf. The Arab Brazilian Chamber also noted that the closing of the food service in most Arab countries due to the local lockdown led to the adaptation of portioned products sold to restaurants for sale in supermarkets and for home delivery, in addition to the increased demand for fruit in all large markets in the region.

Source: Brazil-Arab News Agency

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