Despite the advance, sector faces problems of competitiveness with external market
Sales of chemical products increased 0.72% in the accumulated from January to October, according to the Brazilian Association of Chemical Industry (Abiquim). The result was not better because the indicator registered monthly declines in September and October, whose performance is not due only to a weak economy.
There have also been maintenance outages, which are common safety operations in the chemical industry, and fewer business days.
But in the comparisons of other indicators and in the month to month. The results were negative. This is the case of industrial chemical production, which fell 3.06% from January to October, compared to the same period last year, according to the Brazilian Chemical Industry Association (Abiquim).
Apparent national consumption (CAN), which measures production plus imports minus exports, fell by 2% in the same period. According to Abiquim, the result indicates a drop in the national demand for chemicals.
External Impact
In relation to domestic sales, which rose 0.72%, Abiquim says that there is an increase in the share produced in the national territory, in comparison with the imported one, under the influence of exchange rate volatility and international prices.
The average installed capacity utilization from January to October was 77%, which is lower than in the same period of 2017, when the utilization rate was 79%. The index measures the idleness of factory facilities, indicating that from 2017 to 2018 there was a reduction in activity, albeit small (from 79% to 77%
Abiquim’s Economy and Statistics Board, Fátima Giovanna Coviello Ferreira, says that the year was marked by the slowdown in the economy in the first few months, followed by the truck drivers’ strike, which slowed cargo handling in May, also reflecting in June.
Last month
In October, compared to the previous month, the production index rose 3.08%. Compared with October last year, the drop in production was 6.7%. Domestic sales, however, fell by 5.05%, after falling by 8.12% in the two months.
“Although we still had a growth of 0.72% in domestic sales, this result could have been better, since until September the growth was 1.8%”, he says.
“The lowest activity in the last two months of analysis can be attributed to the pauses made in some units, the demand slowed in relation to the previous two months and, to a lesser extent, also by the lower number of working days, especially in relation to August”, says Fátima.
Low competitiveness
The director warns that in the last 12 years production and sales volumes are, on average, the same as in 2007.
“Unfortunately we live another lost decade. The lack of competitiveness of the local producer, coupled with the economic recession and worsening of the national political crisis in the last three years, has brought strong impacts to the sector”, he says.
Source: A Tribuna Newspaper