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Industrial production

Industry grows 1.1% in October and is 1.4% above the pre-pandemic level

Section: Economic Statistics | Caio Belandi

December 02, 2020 09h00 AM | Last Updated: December 02, 2020 04h34 PM

Motor vehicle production grew by 1,075.8% in six months, but is still below February's level - Photo: Itamar Aguiar Palácio Piratini

The domestic industry production grew for the sixth consecutive month in October and registered an increase of 1.1% in comparison with September. With the cumulative result of 39% in six months, the sector is 1.4% above February's level, before the Covid-19 pandemic. Even so, in the cumulative result for the year, production is negative (-6.3%). The cumulative index for the last 12 months is -5.6%. In relation to October 2019, the increase is 0.3%. The data are from the Monthly Survey of Indistry (PIM), released today (2) by the IBGE.

Two of the four major economic categories showed growth, with a highlight to Capital Goods, which increased 7% from September to October. Durable consumer goods grew 1.4%. Both marked the sixth consecutive month of expansion in production, accumulating 111.5% and 506.7%, respectively. The first is 3.5% above February’s level, while the second is still 4.2% below.

Intermediate goods (-0.2%) and Semi- and non-durable consumer goods (-0.1%), in turn, had negative results, interrupting five consecutive months of growth in production, with accumulated gains of 26.6% and 30.4 %, respectively.

The survey manager, André Macedo, points out that the growth in October reflected a different behavior from the last months, when advances were disseminated among the sectors. This time, 15 of the 26 sectors surveyed showed an increase in production, against 22 of the 26 in September. For the economist, the effect of the pandemic was evident in the sector, especially in the months of March and April, with stricter social distance measures.

“Even with this sequence of increases and the recovery by the level of February, the cumulative result for the year is still negative”, explains Mr. Macedo. In comparison with the record level of production reached in May 2011, industry is still 14.9% below the peak.

Motor vehicle grows 1,075.8% in six months, but does not offset pre-pandemic levels

Among the activities, the most relevant influence from September to October was Motor vehicles, trailers and bodies, with an increase of 4.7%. Severely affected in the critical months of the pandemic, the activity accumulated an expansion of 1,075.8% in the last six months, but it is still 9.1% below the level of February. "The losses were very sharp in March and April", points out Mr. Macedo.

Other sectors with a positive influence on the result of the month in the industry were Basic metals (3.1%), Pharmaceuticals (4.5%), Machinery and equipment (2.2%), Metal products (2.8%) , Leather, travel goods and footwear (5.7%), Non-metallic mineral products (2.3%), Manufacture of wearing apparel and accessories (5.0%) and Rubber and plastic products (2 ,1%).

Among the eleven activities that fell, the main negative impacts were Food products (-2.8%), which came from three consecutive months of highs accumulating 4.3%. Mining and quarrying also contributed negatively (- 2.4%). It was the second consecutive month of decline, accumulating a loss of 7.0%. Other relevant decreases: Coke, petroleum products and biofuels (-1.2%), Tobacco products (-18.7%) and Other chemicals (-2.3%).

With fewer working days, October grows 0.3% against October 2019

In comparison with October 2019, the industrial sector showed an increase of 0.3%, with positive results in two of the four major economic categories, 16 of the 26 sectors, 45 of the 79 groups and 50.8% of the 805 products surveyed, even with October 2020 having two business days less than October of the previous year.

Among the activities, we highlight the positive influences of Coke, petroleum products and biofuels (7.2%), Machinery and equipment (9.4%), Beverages (9.9%) and Non-metallic mineral products (9.8%) and negative rates from Motor vehicles, trailers and bodies (-14.6%) and Mining and quarrying industries (-6.0%).

With regard to the major economic categories, intermediate goods (3.2%) registered the sharpest increase in October 2020 against October 2019. Capital goods (2.1%) also registered a positive rate. Durable Consumer Goods (-8.3%) and Semi and Non-Durable Consumer Goods (-3.4%) segments declined

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