produtos químicos + chemicals
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Prices cause imbalance in the Brazilian chemicals market

Sep, 22, 2023 Posted by Gabriel Malheiros

Week 202338

Since the beginning of 2023, the Brazilian chemicals market has taken in more imports, staying in the range of $5 to $5.5 billion per month. This marks a significant rise compared to pre-pandemic values, which ranged from $3 to $4.5 billion. However, this increase has been constrained by a 17% reduction in the average price of imported products until August. In contrast, Brazil’s chemical exports have generated less revenue, at about $1.2 billion, accounting for approximately 1.2 million tonnes sent to other countries.

With the exception of chemicals related to agribusiness, most other chemical product groups have seen an increase in imports, with notably lower prices compared to the previous year. Chemical imports totaled $41.9 billion, a 24% decrease compared to 2022, primarily due to a 39.1% reduction in average prices. This has caused an imbalance in the domestic market and triggered predatory and unfair acquisitions driven by artificially sustained competitiveness due to the conflict in Eastern Europe.

“On the other hand, exports reached $9.9 billion, a 17.8% decrease compared to the value recorded between January and August of last year. This result has been continuously worsened within the context of Argentina’s economic turmoil, which is the main destination market for Brazilian chemical products. That has worsened the level of idleness in strategic product groups manufactured in the country.”

See below Brazil’s exports of chemical products compared to its imports (hs 28-29) between January 2019 and July 2023. The data is from DataLiner

Exports and imports of chemicals | Jan 2019 – Jul 2023 | WTMT

Source: DataLiner (click here to request a demo)

The deficit in the chemical trade balance from January to August 2023 reached $32 billion, a value exceeding most annual deficits of the last two decades. In the past 12 months (from September 2022 to August 2023), the trade deficit reached $51.7 billion, reinforcing the urgent need for measures to combat predatory imports and safeguard the domestic market from external vulnerabilities in an international scenario that is particularly adverse,” indicated the Brazilian Chemical Industry Association (Abiquim).

Source: Agrolink

Read more at https://www.agrolink.com.br/noticias/precos-desequilibra-mercado-de-produtos-quimicos_483709.htm

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