Brazil´s trade balance registers record surplus in August

In August, the Brazilian trade balance registered a record surplus, with US$6.609 billion more exported than imported.  This is the best result for the month since the beginning of the historical series in 1989.

Both exports and imports fell last month, with the daily export average falling 5.5% year-on-year to US$17.741 billion, and imports falling 25.1% to US$ 11.133 billion.  With the August result, the trade balance accumulates a surplus of US$36.594 billion in the first eight months of the year. This is the third-best result in the historical series for the period.

The cumulative export total for the first eight months of 2020 totaled US$138.633 billion, a decrease of 6.6% in comparison with year-ago levels. Imports totaled US$102.039 billion, a decrease of 25.1% by the same criterion.

Most of the increase in the balance in August is explained by the fall in imports from the mining industry, which fell 59.51% in relation to the same month last year, and from the manufacturing industry, whose purchases from abroad shrank 23.78%. On the export side, manufacturing industry sales fell 14.2%, and for the mining industry fell 8.6%. In contrast, agricultural exports rose by 32.64%.

Product Categories

Among the products that drove the growth of agricultural exports in August, the highlights were soybeans, whose value sold increased by US$443.3 million in relation to the same month last year, and raw cotton, with an increase of US$80.9 million in the same comparison.

In the mining industry, exports of iron ore fell by US$ 442 million compared to August last year, and crude petroleum oils suffered a decrease of US$451.6 million. In both cases, the drop is due to the negative variation in international prices compared to 2019, because the volumes shipped were stable in the case of iron and increased 21% in the case of oil.

In the manufacturing industry, the largest declines were recorded in exports of non-electric engines and machines (-US$187 million), cellulose (-US$157.8 million), and petroleum fuel oils (-US$152.6 million). In addition to the COVID-19 pandemic, which impacted the economy worldwide, the crisis in Argentina, the main destination for Brazilian industrial exports, contributed to the result.

Annual target

After the trade balance ended 2019 at US$48.035 billion, the second-largest positive result in history, the market estimates a smaller surplus in 2020, mainly due to the pandemic.  According to the Focus bulletin, a weekly survey of financial institutions released by the Central Bank, market analysts predict a US$55 billion surplus for this year. In July, the Ministry of Economy updated the positive balance estimate to US$ 55.4 billion.

Source: Agência Brasil

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