Oil and Chemicals Lead Brazil’s 6% Industrial Sales Growth

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An offshore oil platform in Brazil Brazil's industrial sales grew 3% in January when compared to December 2006, in a comparison free from seasonal influences. When January sales are compared to January 2006, the growth is 6%.

The sectors that led this performance were chemical and oil products, responsible for almost 60% of all industrial sales growth in the period.

This information was disclosed in the Industrial Indices research, just disclosed by Brazil's National Confederation of Industries (CNI).

According to the research, sales of oil refining and alcohol companies rose 21.6% in January 2007 when compared to the same month in 2006. In the chemical product sector, the index rose 12.2%. "Both sectors represent almost 60% of the entire growth in industrial sales in the period," according to the research.

The executive manager at the Economic Policy Unit at the National Confederation of Industries (CNI), Flávio Castelo Branco, stated that the industrial performance in January confirms the moderate growth of the economy in 2007.

According to him, the favorable conditions present at the end of last year, with falling interest rates, greater credit and a recovery of family income, continued in early 2007.

With a new methodology, the research shows that industrial employment remained stable, with expansion of just 0.2% in January over December when considering seasonal adjustment. In the same period, the hours worked in production dropped 1.3%.

Remuneration of industry workers rose 7.7% in January this year when compared to the same period in 2006. The research is based on the average wage in medium and large companies in 12 states.

Employment

The food and drink sector powered the expansion of hours worked on production, of employment and of remuneration in industry in January. According to the figures disclosed by the CNI, the hours worked on production rose 11.1% in January when compared to the same month in 2006. In the same period, the employment in these companies rose 12.9% and remuneration of laborers had expansion of 16.4%.

"The food and beverage sector contributed with over 70% of the growth of industrial employment figures in the last 12 months, ending in January 2007," according to the study. All the sector indices were greater than the national average due to the activity of companies connected to the production of sugarcane, explained CNI economist Paulo Mol. In January 2007, in comparison to the same month in 2006, the national average of hours worked in production rose 3%, employment rose 3.6% and worker remuneration, 7.7%.

The remuneration of industry workers rose in 15 of 21 sectors studied, with special attention to the food and beverage sector, in which worker income rose 16.4%. Other sectors in which income posted expressive growth were the information technology sector, with expansion of 45.2%, machinery and electric equipment, with 15.3%, and textile, with growth of 12.5%. The sectors that registered the greatest reductions were electronic and communication material, with retraction of 10.1%, and wood, down 2.1%.

Flávio Castelo Branco explained that the paid income considers not only salaries, but also overtime, bonuses, prizes, profit sharing and other forms of payment used by the industry. The study also shows that the installed capacity in industry dropped from 81.1% in December 2006 to 80.9% in January 2007.

Exports

Exports from Brazil amounted to US$ 2.98 billion last week, a 7.89% increase compared with the week before, whereas imports reached US$ 2.322 billion, a 12.94% increase. The trade flow resulted in a positive balance of US$ 658 million for the week.

The accumulated surplus for the month reached US$ 2.353 billion. The figures were disclosed today (26) by the Brazilian Ministry of Development, Industry and Foreign Trade.

Trade balance for the year reached US$ 7.722 billion, a 10% decrease compared with the same period last year.

This year, exports totaled US$ 30.9 billion, a 13.97% increase over the same period in 2006. Imports saw a much greater increase. They amounted to US$ 23.178 billion up until now, a 25.45% increase.

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