Imports of electric vehicles reduce Brazil’s balance of trade

Driven by the slump in the price of soybeans and corn and the surge in imports of electric vehicles, the surplus in Brazil’s balance of trade declined in June. Last month, the country exported $6.711 billion more than it imported, the Ministry of Development, Industry, Trade, and Services reported Thursday (Jul. 4).

In June, Brazil sold $29.044 billion abroad, up 1.4 percent on the same month in 2023. Purchases from abroad totaled $22.333 billion, up 3.9 percent.

The surplus of $6.711 billion represents a drop of 33.4 percent from the same month last year, but it is the fourth best for the month of June, second only to June 2021’s record of $10.414 billion, 2023’s record of $10.077 billion, and 2022’s record of $8.89 billion.

The ministry’s Director of Foreign Trade Statistics and Studies Herlon Brandão argued that the rise in imports of electric cars shows that purchases are being brought forward in order to build up stocks and dodge higher import taxes on vehicles.

“There is demand for these hybrid and electric vehicles. And there’s the question of the increase in import tariffs. As there was an increase in July, importers are expected to bring forward their operations in order to pay lower tariffs,” he noted. Following a schedule laid down in November last year, tariffs for electric cars rose from 12 to 25 percent in July.

The balance of trade amassed a surplus of $42.31 billion in the first half of this year, down 5.2 percent on the same time span last year. This is the second highest result for the period since the beginning of the time series in 1989—second only to 2023, which had $44.617 billion.