Between May and June, the country's industrial production grew by 4.1%, interrupting two consecutive months of negative rates, a period in which it accumulated a loss of 1.8%. As a consequence, the industrial sector recorded the most intense positive result since July 2020, when it had registered an increase of 9.1%. June's results led the industry to surpass the pre-pandemic level (2.8% above February 2020), but it is still 14.3% below the record level reached in May 2011. The data are from the Monthly Survey of Industry (PIM), released today (2) by the IBGE.

“In general terms, it is worth highlighting that the sharpest increase observed in June 2024 is related not only to the depreciated basis of comparison, explained by the two consecutive months of falling production, but also by the reactivation of several production units that were directly or indirectly affected by the rains in Rio Grande do Sul in May 2024”, highlights the survey manager, André Macedo.

Of the 25 activities investigated by the survey, 16 increased in June. The most significant positive influences came from coke, petroleum products and biofuels (4.0%), chemical products (6.5%), food products (2.7%) and mining and quarrying industries (2.5%).

“In the activity of petroleum products and biofuels, there was a cumulative gain of 6.2% in two consecutive months of expansion in production. It is important to remember that this activity had been predominantly negative between December 2023 and April of this year. Recent growth has been driven mainly by ethanol and the petroleum derivatives group,” points out the survey manager.

The chemical products sector, with a 6.5% increase in June, offset the 2.7% decline observed in the previous month. “This is a sector that, directly or indirectly, suffered from the impacts of the rains that affected Rio Grande do Sul. Some industrial plants were shut down. Therefore, the increase observed in June is primarily a compensatory factor, but it outweighs the drop noted in May,” explains Mr. Macedo.

Regarding the other two activities with the greatest positive influences, the PIM manager explains that the food products sector (2.7%), which represents about 15% of Brazil's industrial activity, had an increase in the production of important products, such as sugar, soybean derivatives, orange juice and poultry. As for the mining and quarrying industries (2.5%), the two most important products within the activity showed expansion: iron ore and petroleum.

Other relevant positive contributions to the industry as a whole came from basic metals (5.0%), motor vehicles, trailers and bodies (3.1%), beverages (3.5%), machinery and equipment (2.4%), tobacco products (19.8%) and pulp, paper and paper products (1.6%).

On the other hand, among the nine activities that showed a reduction in production, other transportation equipment (-5.5%) had the main impact in June 2024 and interrupted two consecutive months of positive rates, a period in which it accumulated a gain of 4.8%.

“The drop recorded by the other transportation equipment sector interrupts two months in the positive field. The negative influences on the result come from both motorcycles and the part related to the capital goods segment, such as boats and aviation. It is important to highlight that it is an activity that has little influence on the general industry, around 1%”, highlights the manager.

Other significant negative influences were recorded by leather goods, travel goods and footwear (-4.1%), printing and reproduction of recorded media (-9.1%) and manufacture of wearing  apparel and accessories (-2.7%).

In the year-on-year comparison, industrial production grows by 3.2%

In comparison with June 2023, the industrial sector recorded an expansion of 3.2% in June 2024, with positive results in four of the four major economic categories, 18 of the 25 sectors, 44 of the 80 groups and 52.0% of the 789 products surveyed.

“The industrial sector returns to positive rates in the year-on-year comparison, although there was a decline in May. In June, the four broad categories showed expansion and 18 of the 25 activities also showed growth, even considering the calendar effect, since June 2024 had 1 fewer business day than June 2023. Even so, industrial production reversed the result of May, when the calendar effect had been the same”, says the manager.

Among the activities, the main positive influences on the total industry were recorded by coke, petroleum products and biofuels (4.3%), pharmaceutical products (17.5%), food products (2.4%), motor vehicles, trailers and bodies (5.9%) and computer equipment, electronic and optical products (18.4%).

It is also worth highlighting the positive contributions made by the sectors of pulp, paper and paper products (8.3%), chemicals (4.1%), electrical machinery, equipment and materials (10.1%), beverages (5.6%), furniture (13.9%), mining and quarrying industries (0.9%), other transportation equipment (9.8%) and basic metals (2.0%).

On the other hand, still in comparison with June 2023, among the seven activities that showed a reduction in production, printing and reproduction of recorded media (-22.8%) exerted the greatest influence on the formation of the industry average, pressured mainly by the lower production of paper money (banknotes), leaflets for advertising or promotional purposes in films and books, brochures or printed matter on demand. Other significant negative impacts were reported by the wearing apparel and accessories manufacturing sectors (-5.0%) and miscellaneous products (-6.9%).

More about the survey

PIM Brasil has been producing short-term indicators since the 1970s regarding the behavior of real output in the mining and quarrying and manufacturing industries. In March 2023, the new series of monthly industrial production indexes was introduced, after being reformulated to update the sample of activities, products and informants; to develop a new weighting structure for the indexes based on the most recent industrial statistics; to update the base year of reference for the survey; and to incorporate new states in the release of the regional results of the survey. These methodological changes are necessary and seek to incorporate the economic changes in society.

The next release, for June 2024, will be on September 4. The survey results can also be consulted on the Sidra database.