After changing 0.2% in the previous month and -0.3% in July, the Brazilian industrial output changed 0.1% between August and September. The major positive influence on the result this month came from the activity of mining and quarrying industries, with a rise of 5.6%. The national industry rose 0.6% in relation to September 2022. In the year, the cumulative index registered -0.2% and, in the last 12 months, a null change (0.0%). These data come from the Monthly Survey of Industry (PIM), released today (1) by the IBGE.

“The September´s result of the national industrial output marks the second consecutive month of growth, though it doesn´t change the less dynamic behavior that characterizes it over the last months. Nevertheless, negative rates prevail in this month´s index, reaching three out four broad economic categories and 20 out of 25 industrial sectors investigated,” highlights André Macedo, manager of the survey.

The researcher also points out that, even with two consecutive months of positive figures, the industrial sector is still 1.6% below the pre-pandemic level (February 2020) and 18.1% below the record level reached in May 2011.

“On the whole, a high interest rate, even with the reduction recorded over the last months, helps us to understand this behavior of the industrial sector, by directly influencing investment decisions of companies and consumption of families. In addition, it explains a still expensive credit and high default rates,” completes him.

Among the activities, the most important positive influence was recorded by mining and quarrying industries, which advanced 5.6% this month, after accumulating a loss of 5.6% in the July-August 2023 period. Other relevant positive contributions to the overall industry came from chemicals (1.5%) and coke, petroleum products and biofuels (0.5%).

“In addition to its low comparison basis as it came from two drops in sequence, the sector of mining and quarrying industries was also favored by a bigger extraction of petroleum and iron ore this month. This segment represents nearly 15% of the overall industry and exerts the major positive impact on the consolidated rate in the year,” highlights Macedo.

Among the 20 activities that reduced their production, petrochemicals and pharmaceuticals (-16.7%),  machinery and equipment (-7.6%) and motor vehicles, trailers and bodies (-4.1%) exerted the major impacts in September 2023, the first one interrupting two consecutive months of expansion, a period in which it accumulated a gain of 30.2%, and the last two ones retreating once again after reporting advances in the previous month: 4.9% and 5.7%, respectively.

“The pharmaceutical industry is characterized by a high volatility. High drops and advances in sequence are common along the time series. Therefore, the two-digit retreat this month bears an important relationship with the cumulative advance of 30.2% in the months of July and August 2023,” analyzes the manager of the survey.

Macedo also points out that the three sector that mostly negatively influenced the industrial sector this month exerted relevant positive impacts last August as well. And it has been a characteristic of the production along the year: drops and advances that offset each other. “It also happens with the overall industry and it is well characterized whenever we compare the level of September 2023, which is the same as May this year, with the level of December 2022: a positive surplus of only 0.3% is noticed. In other words, after nine months in 2023, industry advanced only 0.3% over the level that it closed the year of 2022,” clarifies him.

Industrial activity advances 0.6% in the inter-annual comparison

Comparing with the same month a year ago, the industrial sector advanced 0.6% in September 2023, with positive figures in two out of four broad economic categories, ten out of 25 sectors, 28 out of 80 groups and 38.8% of the 789 products surveyed. It is worth mentioning that September 2023 (20 days) had one less business day than the same month in the prior year (21).

The major positive influences on the overall industry were registered by coke, petroleum products and biofuels (11.3%), mining and quarrying industries (9.1%) and food products (6.7%). It should also be highlighted the positive contribution recorded by the sector of printing and reproduction of recorded media (17.3%).

Still comparing with September 2022, among the 15 activities that reduced their production, motor vehicles, trailers and bodies (-15.8%) and machinery and equipment (-12.4%) exerted the biggest influences on the industry average. Other important negative impacts came from electrical machines, appliances and material (-11.5%), computer equipment, electronic and optical products (-12.0%), chemicals (-3.0%), manufacture of wearing apparel and accessories (-10.0%), leather, travel articles and footwear (-13.4%), fabricated metal products (-6.9%), non-metallic mineral products (-6.6%), miscellaneous manufacturing (-12.3%) and petrochemicals and pharmaceuticals (-5.2%).

More on the survey

PIM Brazil has been producing short-term indicators since the 1970s regarding the behavior of the real product of mining and quarrying and manufacturing industries. March 2023 marked the beginning of the release of the new time series of monthly indexes of the industrial production, after a redesign to update the sample of activities, products and informants; create a new weighting structure of the indexes based on the most recent industrial statistics; update the base year of reference of the survey; and incorporate new Federation Units in the release of regional results of the survey. These methodological changes are required and they aim at incorporating the economic changes of the society. The survey results are also available at the Sidra database. The next release of the industrial production - Brazil will be on December 1st.