Brazil’s trade surplus falls in September to lowest level in seven months

RIO DE JANEIRO, BRAZIL – Brazil recorded a trade surplus of US$4.322 billion in September, the lowest level in the last seven months and a value 15% lower than in the same month the previous year, due to the sharp jump in imports, the Government informed this Friday.

The positive balance in September was lower than that of the same month last year (US$5.1 billion) and 43.4% lower than that of August of this year (US$7.6 billion), according to data released by the Ministry of Economy.

The sharp fall in the surplus was attributed to the jump in imports, which totaled US$19.962 billion in September, an increase of 51.9% compared to the same month in 2020, favored both by the devaluation of the real against the dollar and by the economic reactivation of the country after the crisis caused by the pandemic, which led several sectors to increase their foreign purchases.

Exports also grew in September, but by a lower percentage (+33.3%), to US$ 24.284 billion, the highest value for this month since 1989.

According to the Ministry of Economy, Brazil accumulated between January and September of this year a surplus in its trade balance of US$56.443 billion, an increase of 38.3% compared to the first nine months of 2020 and the highest value for the period in the country’s history.

Between January and September, exports grew by 36.9 % to US$ 213.223 billion, and imports rose by 36.4 % to US$ 156.790 billion.

Brazilian exports grew in September, favored by appreciating raw material prices, mainly minerals and foodstuffs. While the volume shipped abroad increased by 3.8% in September compared to the same month last year, the value received by exporters jumped by 30% due to the reasonable prices of their products.

The value of agricultural exports rose by 12.4% in September, with timber (+224.3%), soybeans (+57.9%), and coffee (+10.2%) standing out.

Revenues from mineral exporters, on the other hand, rose by 41.4%, with crude oil (+61.1%), copper and its concentrates (+84.3%), and iron (+30.9%) standing out.

As for imports, those that rose the most in September were those of the mineral sector (+240 %) and those of industry (+46.6 %), with highlights for natural gas (+552.9 %), fertilizers (+126.6 %), medicines and pharmaceutical products (+228.9 %) and fuels (+86.17 %).

The increase in imports in recent months and the forecast that they will continue to grow forced the Ministry of Economy to reduce its projection for the trade balance surplus this year, from the $105.3 billion previously forecast to $70.9 billion in its new forecast.

Despite that reduction, Brazil will end 2021 with a record trade surplus, should that value finally be confirmed.

Between January and December 2020, South America’s largest economy accumulated a surplus in its trade balance of $50.995 billion, 6.1% more than in 2019. However, both exports and imports were lower due to the impacts of the new coronavirus pandemic.