The latest data on Brazil’s industrial production reveals a marginal increase of 0.3% in May 2023 compared to April, in the seasonally adjusted series. In the year-on-year comparison, industrial output recorded a growth of 1.9% in May. However, for the accumulated period of the first five months of the year, there was a decrease of 0.4%, while the 12-month variation remained unchanged at 0.0%. The quarterly moving average stood at 0.3%.
The industrial sector’s growth in May follows a decline of 0.6% in April. Positive growth rates were observed in three out of the four major economic categories and 19 out of the 25 surveyed industrial sectors. Despite the recovery, the industry remains 1.5% below the pre-pandemic level (February 2020) and 18.1% below the record level reached in May 2011.
The positive influences on industrial production in May came from sectors such as coke, petroleum and biofuels (7.7%), motor vehicles, trailers, and bodies (7.4%), and machinery and equipment (12.3%). Notably, the coke and petroleum sector has seen four consecutive months of production expansion, accumulating a gain of 15.0% during this period. Other significant contributions to the overall industry came from extractive industries (1.2%), metal products (6.1%), other transportation equipment (10.2%), metallurgy (2.1%), miscellaneous products (6.6%), and leather, travel goods, and footwear (4.9%).
On the other hand, the production of food products (-2.6%) and pharmochemical and pharmaceutical products (-9.7%) experienced declines in May, exerting notable negative impacts on overall industrial output.
Analyzing the performance of major economic categories, durable consumer goods (9.8%) and capital goods (4.2%) recorded the most significant advances in May compared to the previous month, bouncing back from declines of -4.5% and -11.8%, respectively. Intermediate goods (0.1%) also showed positive growth for the fourth consecutive month, accumulating a gain of 1.9%.
Looking at the quarterly moving average, industrial production showed a positive variation of 0.3% in the quarter ending in May 2023, following increases of 0.1% in April and 0.2% in March.
In the year-on-year comparison, industrial production increased by 1.9% in May 2023, with positive results in three out of the four major economic categories, 9 out of the 25 sectors, 38 out of the 80 groups, and 43.9% of the 789 products surveyed. Noteworthy contributions came from extractive industries (12.0%), coke, petroleum and biofuels (7.1%), and food products (5.8%).
While the industrial sector in Brazil still faces challenges and variations across different sectors, the marginal growth in May indicates a positive trend in industrial production. The government and industry stakeholders will continue to monitor the situation and implement measures to support and strengthen the manufacturing sector in the coming months.