The surplus of the Brazilian trade balance reached a record value in 2017: USD 67 billion. The surplus should be smaller in 2018, with more imports and lower export growth. This data comes from the monthly Foreign Trade Indicator (ICOMEX) calculated by FGV’s Brazilian Institute of Economics (IBRE).

Unlike in 2015 and 2016, when the surplus was led by a higher decrease in imports compared to exports, the surplus in 2017 was driven by a higher increase in exports (17.6%) compared to imports (9.6%). The 23 main commodities exported by Brazil have accounted for 77% of the increase in exports between 2016 and 2017, and 52% of total exports in 2017. The growth in exports of non-commodities was below the 8.8% increase in commodities. This good performance is explained by the 13.8% increase in prices and 10.5% increase in volume between 2016 and 2017.

“We do not expect the prices and volume of commodities to rise like in 2017, which was a recovery compared to the low levels of 2015/2016, particularly for iron ore and oil. The increase in volume depends on the growth of global trade, which should be lower this year than in 2017 (around 3.5%), from a low base (the growth in 2015/16 was 1.3%),” said IBRE researcher Lia Valls.

Exports grew by 9.4% in volume, led by the agricultural industry (24.3%). Prices rose 9.5%, especially the extractive industry, which showed an increase of 34%. Imports of capital goods from the manufacturing industry continue to fall since 2014. On the other hand, the agricultural sector, which followed the same trend, increased its imports of capital goods by 39.7%. After dropping consistently since 2013, imports of intermediate goods by the manufacturing industry started to grow once again (7.4%), confirming the industry’s recovery trend. 

The oil and byproducts index was added in this edition of ICOMEX. In 2017, prices rose 32% and volume increased by 19.6%. Neither index had recorded positive variations since 2010. 

Go to the website to see the complete ICOMEX results.