By Lise Alves, Senior Contributing Reporter
SÃO PAULO, BRAZIL – The trade balance in Brazil for January through July of 2016 registered the highest surplus for the period since the series started in 1989, at US$28.23 billion, according to data released by the Ministry of Development, Industry and Foreign Trade (MDIC). Among the factors that favorably influenced the Brazilian trade balance were the significant reduction of imports and the foreign exchange rate.
According to Herlon Brandão, director of the Statistics and Export Support Department at MDIC from January to July exports totaled US$106.583 billion, a decrease of 5.6 percent over the same period of 2015 while imports reached US$78.353 billion, a decline of 27.6 percent over the same period last year.
The government official stated that the biggest decline in imports in the first seven months of the year in comparison to the same period last year were in fuels and lubricants (-47.7 percent), consumer goods (-27.9 percent), intermediate goods (-24.9 percent) and capital goods (-20.2 percent).
The biggest export declines for the same period were seen in crude oil (-33.2 percent), coffee grains (-27 percent), and iron ore (-23.8 percent) while the largest export gains were registered in corn (+82.6 percent) and unprocessed cotton (+33.8 percent).
The appreciation of the U.S. dollar in relation to the Brazilian real at the beginning of the year also affected in a positive manner the competitiveness of Brazilian commodities in the international market, despite the plunge seen in commodities prices. The recent depreciation of the U.S. dollar is not likely to negatively affect the country’s trade balance since exports contracts were signed months in advance, said the government official.
For the year, the government forecasts a trade balance surplus of between US$45 billion and US$50 billion. The country can therefore exceed the annual record of 2006, when there was a surplus of US$46.4 billion.