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Wednesday, March 22, 2023

the deficit with Brazil reached its highest value since June 2018

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This way, the largest monthly bilateral trade deficit of the last 56 months (since June 2018) was reached; which, given the delicate situation in terms of BCRA reserves, turns on yellow lights ahead – and augurs a greater adjustment to imports. The aforementioned deficit was a consequence of imports and exports -from and to Brazil- that reached US$1,317 M and US$944 M, respectively.

What happened to imports from Brazil in February?

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Imports grew 27.5% yoy more than double the +11.7% yoy seen in January- and reached US$1.317M in February.

Within it, all the products with the highest share of total imports showed positive figures (with the exception of “Iron ore and concentrates” -the fifth most imported product from Brazil in February-, whose imports fell 18.3% yoy). Namely:

– Imports of “Passenger vehicles” and “Parts and accessories for motor vehicles” grew 67.8% yoy and 45.7% yoy, respectively.

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– As in January, the purchase of “Tubes, hollow profiles and pipe accessories, of iron or steel” recorded notable growth -it went from u$s1.8 M in February 2022 to u$s47.6 M last last month year-; and represented 3.6% of total imports from Brazil.

– o Lastly, imports of “Piston engines and their parts” reached US$36.6 M in February (+40.9% yoy).

What happened to exports to Brazil in February?

Exports grew 19.2% yoy in February and reached US$944 M. In this way, they showed a significant acceleration in the rate of growth (it should be remembered that in January they increased a meager 3.4% yoy; and in the last quarter of 2022 fell 11% yoy).

As in the case of imports, all the products with the highest participation in total exports showed positive figures -with the exception of “Wheat and rye, unground”-. For example:

– In relation to the automotive sector, the export of “Passenger vehicles” and “Motor vehicles for the transport of merchandise and special uses” increased by 19.3% yoy and 14.2% yoy, respectively. Both products accounted for 27.0% of the total shipments to Brazil in February, in line with January and the values ​​for 2022 (it should be noted that they were the main export products last year, accounting for just over 1/3 of the total exports to the neighboring country).

– o On the other hand, the export of “Petroleum or bituminous mineral oils, crude” and “Preparations of cereals, flour or fruit or vegetable starch” showed year-on-year increases of over 200%, although in both cases could be explained by the low base of comparison.

– Lastly, the only one of the products with the highest participation in the total whose export contracted in annual terms was “Wheat and rye, unground” -as in January-, falling a notable 25.6% in relation to February of 2022. This fall is explained by the lower national production as a consequence of the droughts and frosts that continue to haunt agriculture in Argentina.

Source: Ambito

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