In September, industrial production fell by 2.0% in comparison with August, considering seasonally adjusted results. Over September 2004, there was growth of 0.2%, the lowest result since September 2003. Considering the index accumulated from January to September, industry grew by 3.8%. The annual rate (indicator accumulated in the last twelve months) decelerated in relation to August: from 5.1% to 4.4%. Production in the third quarter of 2005 had a positive performance over the equivalent quarter in 2004 (1.5%), but it was 0.7% lower than observed in the immediately previous quarter (seasonally adjusted series).

The decrease of production between August and September reached 15 of the 23 subsectors surveyed and four categories of use. The main negative impacts came from tobacco (-37.7%), machinery and equipment (-6.0%), petroleum refinement and alcohol production (-3.8%) and automotive vehicles (-2.4%). The drastic change in the tobacco industry in September occurred after significant increase in August (56.9%); in both months the figures were a consequence of the processing of the item tobacco in leaf in an unusual period. [1]. Among the growing industrial subsectors, other chemical products (1.9%), metallurgy (1.4%) and cellulose and paper (1.8%) were the most relevant contributions. By categories of use, only the segment capital goods expanded its production in this period (1.1%), after significant increase of 3.4% from July to August. For the remaining categories, the rates were negative: intermediate goods (-0.4%); durable consumer goods (-8.9%); and semi-durable and non-durable consumer goods (-3.4%). The rate for durable consumer goods accumulated between June and September was -17.0%.

Negative figure for quarterly moving average after five months of increase

After five months following an upward trend, industrial activity decreased and this downward trend in September was reflected by the quarterly moving average index, which has decreased between August and September (-1.1%). This change reached all the categories of use, with durable consumer goods presenting the most significant reduction (-6.0%). The other results are: semi-durable and non-durable consumer goods (-1.0%), capital goods (-0.7%) and intermediate goods (-0.7%). This kind of situation – which reflects the reduction of all the categories in this kind of comparison – had last occurred in June 2003.

Over September 2004, there was slight increase (0.2%) of general industry, with mining and quarrying advancing 10.6% and manufacturing industry falling by 0.3%. In August, the extraction subsector already presented rhythm above the industry average (3.7%), but manufacturing industry had rates of 3.8%. Among the 27 subsectors surveyed, 15 grew, and the highlights in this case were electronic material and communication equipment (19.8%), quarrying industry (10.6%) and editing and printing (10.1%). In terms of products, the main highlights were, respectively, mobile telephones and telephony-related appliances; iron ore and magazines and newspapers. On the other hand, the main negative contributions to the overall index came from machinery and equipment (-9.1%), influenced by the items refrigerators and compressors, and food products (-4.0%). In the latter, the main highlights were sugar (crystallized and refined) and bovine meat.

Still regarding the comparison with September 2004, according to indexes by category of use, intermediate goods was the only subsector which decreased (-0.4%). For the other ones, the rates were: capital goods (6.4%); durable consumer goods (0.4%) and semi-durable and non-durable consumer goods (0.3%). The production of intermediate goods was mainly influenced by the subsectors food products and special beverages (12.5%) and special industrial inputs (-0.9%).These results were attenuated by the positive contribution from basic industrial inputs (-1.4%) and packaging (-3.5%), both negative since July.

The significant increase of capital goods (6.4%) is due to the positive performance of all the subsectors, except agricultural consumer goods (-44.0%) which completed, in September, a sequence of thirteen consecutive falls. The remaining subsectors of capital goods had the following results: capital goods for industrial uses (1.9%); construction (33.7%); electric energy (35.5%); transportation (3.4%) and capital goods for mixed use (8.8%). With a 0.4% change, durable consumer goods had its lowest rate since June 2003, a consequence of the decrease of the production of automobiles (1.1%) and household appliances (-14.3%). Concerning the latter, the reduction observed was more significant for items such as refrigerators, washing machines, stoves, etc (-36.4%) than for others such as television sets, DVD players, etc (-0.8%). For the segment of semi-durable and non-durable consumer goods (0.3%), the positive figures result from the advance of the subsector other non-durable consumer goods (-4.5%). This reflects the increase of the production of magazines and medicines. The negative contribution of the subsector semi-durable goods (-9.1%) is due, above all, to the item plastic and leather shoes.

Considering the index accumulated in the year (January to September), the overall rate (3.8%) results from the positive performance of 19 subsectors. The main contribution among them came from automotive vehicles (8.8%), followed by electronic equipment and communication equipment (20.6%). In terms of products, the highlights of these sectors were, respectively, automobiles and tractors and mobile telephones and television sets.

In the quarterly comparisons, the industrial subsector has shown positive results for eight consecutive quarters, but following a deceleration trend (Table 2).

In the quarterly comparisons, the industrial subsector has shown positive results for eight consecutive quarters, but following a deceleration trend (Table 2). In the third quarter of the year, there was increase of 1.5%, whereas in the second quarter the rate reached 6.1%. Still in the same comparison, all the categories of use showed little dynamism between the second and the third quarter of 2005. The only category with performance below the average of industry, intermediate goods, altered its behavior, changing from an increase of 3.2% to a decrease of 0.5%. With a performance above the average of industry, the subsector durable consumer goods was the leader both in the second (21%) and in the third quarter (8.7%). In the same period, capital goods changed from 5.1% to 2.7%, whereas the rates for semi-durable and non-durable consumer goods were 7.9% and 3.6%, respectively.

In summary, the reduction of industrial production is also evident when the quarter / previous quarter indexes are considered (Table 3). The results for September reinforce the signs of deceleration of industrial activity – fall of 0.7% in the third quarter. By categories of use, something similar was observed in durable consumer good (-4.4%) and intermediate goods (-0.6%). The rates for both categories were negative in the third quarter, similarly to the overall average of industry. The category semi-durable and non-durable consumer goods (-0.6%) fell for the second consecutive time. The exception was capital goods, which grew by 0.5% in the third quarter, after expansion of 3.0% in the previous period.

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[1] Normally, the processing of tobacco in leaf goes occurs up to July. This year, as an exception, the end of this process has been delayed until August.