In the seasonally adjusted series, the national industrial output dropped 2.5% in February 2016 over the previous month, after advancing 0.4% in January. Compared with the same month of the previous year in the not seasonally adjusted series, the overall industry registered a fall of 9.8% in February 2016, the 24th negative rate in a row in this type of comparison, though less higher than January's (13.6%). Therefore, the industrial sector recorded a reduction of 11.8% in the first two months of 2016. The annualized rate, cumulative index over the last 12 months, with a drop of 9.0% in February of 2016, repeated the magnitude of the fall seen in the previous month, proceeding not only with the sharpest loss since November 2009 (-9.4%), but also with the downward trend started in March 2014 (2.1%). The complete publication of the Monthly Survey of Industry (PIM -PF) can be accessed here.

Indicators of Industrial Output by Major Economic Categories -
Brazil - February 2016

Source: IBGE, Diretoria de Pesquisas, Coordenação de Indústria
*Série com ajuste sazonal

13 of 24 sectors surveyed declined in February

The drop of 2.5% in the industrial activity between January and February of 2016 showed a widespread fall, reaching three out of the four major economic categories and 13 out of the 24 segments surveyed. Among the sectors, the main negative influence was recorded by motor vehicles, trailers and bodies, which shrank 9.7%, offsetting, thus, the expansion of 7.2% observed between November 2015 and January 2016. Other important reductions came from machinery and equipment (-6.7%), food products (-1.7%), and computer, electronic and optical products (-8.2%). Other important negative contributions to the overall industry came from the activities of electrical machinery and apparatus (-3.5%), basic metals (-1.5%), manufacturing of wearing apparel and accessories (-2.6%), rubber products and plastic material (-1.6%) and other transportation equipment (-3.3%). On the other hand, among the ten sectors that increased the output this month, the major performance in the global average was done by coke, petroleum products and biofuels, which advances 1.4%, the third positive rate in a row, accumulating in this period an expansion of 8.1%. Other relevant positive impacts were seen in the sectors of toiletries, soaps, cleaning and personal hygiene products (1.3%), mining and quarrying industries (0.6%), textiles (3.4%) and beverages (1.3%).

Among the major economic categories, comparing with the previous month, durable consumer goods, shrinking 5.3%, posted the sharpest drop in February 2016, intensifying the 3.3% loss recorded in the previous month, mostly influenced by the lower production of cars and household appliances, still affected by the granting of collective vacation in several producing units. The sectors of intermediate goods (-2.0%) and semi- and non-durable consumer goods (-0.6%) also marked negative rates this month. On the other hand, the segment of capital goods (0.3%) registered the only negative result in February 2016, after also advancing in the previous month (2.1%).

Quarterly moving average declines 1.0%

Still concerning the seasonally-adjusted series, the evolution of the quarterly moving average index for the overall industry declined 1.0% in the quarter ended in February 2016, against the level of the previous month, keeping the downward trend started in October 2014. Among the major economic categories, in relation to the movement of this index on margin, capital goods (-2.3%) recorded the sharpest drop this month and kept the sequence of negative rates started in October 2014. The segments of durable consumer goods (0.3%) and intermediate goods (-0.2%) also registered negative figures in February 2016. On the other hand, the segment of durable and non-durable consumer goods (0.0%) repeated the level registered in the previous month.

Industrial output falls 9.8% in relation to February 2015

Compared with the same month a year ago, the industrial sector dropped 9.8% in February 2016, pointing to a prevalence of negative figures and reaching the four major economic categories, 21 out of the 26 sectors, 59 out of the 79 groups and 67.8% out of the 805 products surveyed. It is worth mentioning that February 2016 (19 days) had one more business day than the same month in the previous year (18).

Among the sectors, the main negative impact was reported in the sector of motor vehicles, trailers and bodies (-29.1%). Other relevant negative contributions to the total came from mining and quarrying industries (-12.1%), machinery and equipment (-27.9%), computer, electronic and optical products (-33.1%), basic metals (-12.1%), rubber products and plastic material (-15.6%), electrical machinery and apparatus (-21.1%), fabricated metal products (-12.7%), other transportation equipment (-24.0%), non-metallic mineral products (-9.6%), textiles (-11.8%) and beverages (-5.1%). On the other hand, still considering the comparison with February 2015, the activities pulp, paper and paper products (6.0%), tobacco products (82.8%) and food products (1.1%) exerted the main positive influences this month.

Comparing with the same month a year ago, durable consumer goods (-29.3%) and capital goods (-25.8%) recorded, in February 2016, the sharpest drops among the major economic categories. The producing sectors of intermediate goods (-8.5%) and semi and non-durable consumer goods (-2.0%) also recorded negative rates this month, yet both below the national average (-9.8%).

The segment of durable consumer goods fell 29.3% in the monthly index of February 2016, the 24th negative rate in a row in this kind of comparison and slightly above that of the previous month (-28.7%). This month, the segment was particularly influenced by the lower manufacture of cars (-31.9%) and brown goods (-35.9%) and white goods (-22.5%). Other important negative impacts came from motorcycles (-36.9%), other household appliances (-27.8%) and of furniture (-7.2%).

The producing sector of capital goods, shrinking 25.8% in February 2016, also registered the 24th consecutive negative result in the monthly index, but posted a less intense drop than the one seen in the previous month (-35.7%). Concerning the formation of the index this month, the segment was influenced by the decline seen in all of its groups, clearly highlighted by the reduction of 24.5% in capital goods for transportation equipment. The other negative rates were registered by capital goods for industrial purposes (-19.5%), for mixed use (-28.3%), for construction (-56.6%), for agriculture (-33.3%) and for electricity (-18.5%).

The production of intermediate goods, shrinking 8.5% in February 2016, also registered the 23rd consecutive negative result, but posted a less intense drop than the one seen in the previous month (-11.7%). This month's result was mainly explained by the drops in the products related to the activities of mining and quarrying industries (-12.1%), motor vehicles, trailers and bodies (-25.8%), basic metals (-12.1%), rubber products and plastic material (-15.6%), machinery and equipment (-24.1%), fabricated metal products (-12.8%), non-metallic mineral products (-9.5%), textiles (-11.1%), coke, petroleum products and biofuels (-0.6%) and other chemical products (-0.5%), whereas the positive pressures were registered by pulp, paper and paper products (8.3%) and food products (0.7%). In that same category, it is worth mentioning the decrease in the groups of typical civil construction input (-14.8%) and of packaging (-5.2%).

The output reduction in the semi- and non-durable consumer goods (-2.0%) in February 2016 was the 16th consecutive negative rate in the comparison with the same month a year ago, but had a less intense drop than the one seen last January (-7.0%). The performance this month was mainly explained by the decline seen in the groups of semi-durable goods (-10.6%). The sub-sectors of non-durable goods (0.9%) and of food and beverages for domestic consumption (-0.3%) also had negative results this month. On the other hand, the group of fuels (4.5%) posted the only positive figure in this category.

In 2016, industry accumulates a drop of 11.8%

In the cumulative index for the January-February period of 2016, over the same period in the previous year, the industrial sector posted a decrease of 11.8%, with widespread fall, since the four major economic categories, 23 of the 26 activities, 67 of the 79 groups and 75.7% of the 805 products surveyed had reduction in the production. Among the activities, motor vehicles, trailers and bodies (-30.1%) and mining and quarrying industries (-14.6%) exerted the highest negative influence on the industry average. Other negative relevant contribution came from machinery and equipment (-26.8%), computer, electronic and optical products  (-36.6%), basic metals (-13.6%), electrical machinery and apparatus (-22.4%), rubber products  and plastic material (-15.2%), non-metallic mineral products (-12.9%), fabricated metal products (-14.0%), other transportation equipment (-24.5%), beverages (-8.7%), food products (-2.2%)  textiles (-15.8%). On the other hand, pulp, paper and paper products (3.3%) and tobacco products (49.8%) exerted the main positive influences this month.

Among the major economic categories, the behavior of the results of the first two months of 2016 showed lower dynamism for capital goods (-30.8%) and durable consumer goods (-29.0%), particularly pressed by the reduction in the manufacture of capital goods for transportation equipment (-31.1%), in the first category; and of cars (-27.1%) and household appliances (37.7%), in the second one. The segments of intermediate goods (-10.1%) and of semi and non-durable consumer goods (-4.5%) also registered negative rates in the cumulative index of the first two months of the year. The former segment declining below the drop of the national average (-11.8%), and the latter recording the most moderate decline among the major economic categories.