Industrial output up 1.4% in May after three months of decline

The figures come from IBGE’s Monthly Industrial Survey

Published in 02/07/2021 - 14:03 By Ana Cristina Campos - Rio de Janeiro

Brazil’s industrial production increased 1.4 percent from April to May, after three consecutive months on the wan (down 4.7 percent year to date). May’s result brings industry to the same threshold as February 2020, before the COVID-19 pandemic started.

The sector saw a 13.1 percent growth in the first five months of 2021 from the same period last year and a 4.9 percent increase in the past 12 months. Comparing to May last year, the industrial output increased 24 percent, the second highest rate since the beginning of the survey’s time series, in January 2002. The highest was observed last month (34.7%).

Food products (2.9%), coke, oil by-products, and biofuels (3%) and mining industries (2%) were the main drivers behind the month’s increase. The data can be found in the Monthly Industrial Survey, released today (Jun. 2) by the government’s statistics agency IBGE.

Research Manager André Macedo stated that May’s positive result does not mean a reversal in the negative balance from February through April. “There has been a return to positive, but it is far from recovering the recent loss experienced by the industrial sector. Much of the negative predominance in the last few months is directly linked to the aggravation of the pandemic, early in 2021, which brought about a disarray in production chains,” he reported in a note.

The researcher noted that the shortage in the supply of raw materials and the hike in production costs are among the consequences faced by the industrial sector. “Even though the result in May compared to April was positive, if we look at the beginning of 2021, faced with aggravation of the pandemic and all of its effects, the balance is still negative, considering that, if we observe other indicators, like the moving quarterly average, the reading is still on the decline,” he said. In May, the moving quarterly average dropped 0.8 percent.

Translation: Fabrício Ferreira -  Edition: Maria Claudia / Nira Foster

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