High prices for oil and fertilizers made the trade balance drop 22.7 percent. The rising price of several imported items, especially fertilizers and oil, made the trade balance surplus shrink in July. Last month, the country exported US$ 5.444 billion more than it imported, a drop of 22.7 percent compared to the same month in 2012.
In the first seven months of the year, the trade balance accumulates a surplus of US$ 39.751 billion. This represents 10.4% less than that recorded from January to July last year. Despite the decline, the balance is the second best in history for the period, second only to the first seven months of 2021, when the surplus had closed at $ 44.38 billion.
Also read: Brazilian governors have failed to keep more than half of their promises
Last month, Brazil sold US$ 29.955 billion abroad and bought US$ 24.511 billion. Both imports and exports set a record in July, since the beginning of the historical series, in 1989. Exports rose 20% in relation to July last year, by the daily average criterion. Imports, however, increased at a greater pace: 31.6% in the same comparison.
The record imports and exports, however, is due to the increase in the international prices of goods. Last month, the volume of exported goods rose on average only 4.7% compared to July last year, while prices increased 12.2%, favored by the appreciation of commodities (primary goods with international quotation).
Read also: US and UK repeal tariffs on steel products from Brazil
In imports, the quantity purchased rose 8.7%, but average prices rose 41.6%. The rise in prices was pulled mainly by fertilizers, oil, coal and wheat, items that became more expensive after the beginning of the war between Russia and Ukraine.
Sectors
In the agriculture and cattle-raising sector, the increase in international prices weighed more heavily on exports. The volume of goods shipped fell 2.6% in July compared to the same month in 2021, while the average price rose 38%. In the transformation industry, the quantity rose 8.3%, with the average price increasing 18.2%.
In the extraction industry, which includes mineral and oil exports, the quantity exported rose 4.8%, while the average prices dropped 13.9% compared to July last year. While the average price of crude oil rose 41.2% in this comparison, the price of iron ore fell 43.5%, driven by the lockdowns in China, which reduce international demand.
The most important products in agricultural and cattle-raising exports were unground corn (+201.7%), unroasted coffee (+84.4%) and soybeans (+23.8%). This growth is due mainly to prices. The negative highlight was cotton, whose exports fell 50.6% from July last year to July this year because of the anticipation of shipments at the beginning of the year.
Read also: Report accuses Brazil of ignoring forest destruction in Amazonia
In the extractive industry, the largest growths were recorded in exports of crude mineral oils (+92.8%), crude oil (+77.5%) and nickel ore (+53.2%). In the transformation industry, the biggest growths were in fuels (+103.1%), sugars and molasses (+44.6%), and chilled or frozen beef (+27.4%).
Regarding imports, the largest growths were recorded in the following products: Unground barley (+83.5%), whole fish (+34.1%) and unground wheat and rye (+23.2%), in agriculture and livestock; non-agglomerated coal (+211.1%), natural gas (+106.5%) and crude oil (+98.5%), in the extractive industry; and fuels (+82.7%) and processed chemical fertilizers or fertilizers (+175.3%), fuels (+93.4%) and cathode valves (+58.5%), in the processing industry.
Estimate
Last month, the government had reduced to US$ 81.5 billion the trade surplus projection for 2022, because of the rising cost of oil and fertilizers. Despite the drop in the estimate, this figure would guarantee a record trade surplus for the country.
The official estimates are updated every three months. The forecasts are more optimistic than those of the financial market. The Focus bulletin, a survey of market analysts released every week by the Central Bank, projects a surplus of US$ 67.2 billion this year.
