Industrial production down 0,7% in December, closing 2019 with 1.1% cumulative drop
February 04, 2020 09h00 AM | Last Updated: February 05, 2020 05h39 PM
In December 2019, the national industrial production decreased 0.7% compared to the previous month (seasonally adjusted series). It was the second consecutive negative rate, accumulating a 2.4% decrease in this period. In relation to December 2018 (non-adjusted series), the industry fell 1.2%, after also showing loss in the previous month (-1.8%). With these results, the industrial sector retreated both at the end of the fourth quarter of 2019 (-0.6%), and in the cumulative result of the second half of the year (-0.9%), against the same periods of the previous year.
|December 2019 / November 2019||-0.7%|
|December 2019 / December 2018||-1.2%|
|Cumulative in 2019||-1.1%|
|Cumulative in 12 months||-1.1%|
|Quarterly Moving Average||-0.5%|
In the cumulative index for the year, industrial activity decreased 1.1% compared to the same period in 2018, thus interrupting two consecutive years of growth: 2017 (2.5%) and 2018 (1.0%). The full publication of the Monthly Survey of Industry (PIM Brazil) can be accessed on the right of this page.
|Industrial Production by Major Economic Categories - Brazil - December 2019|
|Major Economic Categories||Change (%)|
|December 2019/Novembro 2019*||December 2019/December 2018||Cumulative January-December||Cumulative Last 12 Months|
|Semi- and Non-Durable||-1.4||1.2||0.9||0.9|
|Source: IBGE, Diretoria de Pesquisas, Coordenação de Indústria *Seasonally-adjsuted series|
3 out of the 4 major economic categories and 17 out of the 26 sectors surveyed down in production
The 0.7% decrease of the industrial activity, from November to December 2019, three of the four major economic categories and 17 of the 26 sectors surveyed had reduction in production. Among the activities, relevant negative influences were recorded by Motor Vehicles, trailers and semi-trailers (-4.7%) and machinery and equipment (-7,0%), with the first one recording a fall of 9.7% in three consecutive months of drops in production; and the second one, intensifying the 2.0% loss seen in November 2019.
Other contributions came from mining and quarrying industries (-1.4%), Pharmaceutical Products (-6.2%), leather articles, travel goods and footwear (-6.6%), Basic metals (-1.9%), metal products (2.9%), and rubber and plastic (-2.5%), non-metallic mineral products (-1.8%) and Electrical Machinery and Apparatus (-2.5%).
On the other hand, among the nine sectors that increased the production this month, the most important performances for the global average were registered by coke, petroleum products and biofuels (4.2%), which increases the pace of growth seen in the previous month (1.7%). It is also worth highlighting the positive results coming from the sectors of printing and reproduction of recorded media (39.8%) and of wearing apparel and accessories (5.3%), with the former leveraged, to a great extent , by special orders and showing expansion for the third month in a row, after dropping 29.3% in September 2019; and the latter advances for the second month in a row and accumulated a gain of 7.3% in the period.
Among the major economic categories, still comparing with the previous month, capital goods retreated 8.8% and posted the sharpest drop in December 2019 and kept the prevailing negative behavior present since May 2019, accumulating in the period a reduction of 12.9%. December result was the sharpest drop since May 2018 (-18.5%). The segments of durable consumer goods (-2.7%) and o f semi and non-durable consumer goods (-1.4%) also indicated the negative rates this month, with both of them recording the second month in a row of production decrease and accumulating losses of 5.7% and 2.1%, respectively. Just the sector of intermediate goods had a positive change (0.1%) after falling 1.7% in the previous month.
Quarterly moving average falls 0.5%
Also in the seasonally adjusted series, the evolution of the index of quarterly moving average had decrease of 0.5% in the quarter ended in December 2019 against the previous month, sharpening the negative result registered in November 2019 (-0.2%), when it interrupted the upward trend started in July 2019.
Among the major economic categories, capital goods (-3.8%) and durable consumer goods (-1.5%) recorded the sharpest drops in December 2019, with the capital goods sector keeping the negative behavior initiated in July 2019 and accumulated in this period a reduction of 6,5%; and consumer interrupting the upward trend started in August 2019. The segments of intermediate goods (-0.5%) and of semi-durable and non-durable consumer goods (-0.4%) also recorded negative results in December 2019.
Thus, intermediate goods recorded the second month in a row, accumulating a 1.0 loss in this period; and semi- and non- durable consumer goods interrupted the prevailing upward trend started in December 2018.
Industrial production decreased 1.2% compared with December 2018
Compared with the same month last year, the industrial sector dropped 1.2% in December 2019, with negative figures in two out of the four major economic categories, 14 out of the 26 sectors, 36 out of the 79 groups and 49.4% of the 805 products surveyed. It is worth mentioning that December 2019 (21 days) had one business day more than the same month in the prior year (20).
Among the activities, mining and quarrying industries (-12.2%) exerted the biggest negative influence on the industry average, driven, to a great extent, by the item iron ore. Reduction also took place in Basic metals (-10.4%), Pharmaceutical Products (-17.3%), machinery and equipment (-7.2%), motor vehicles, trailers and semi-trailers (-2.6%), leather articles, travel goods and footwear (-8.6%) pulp, paper and paper products (-2.9%), maintenance, repair and installation of machinery and equipment (-8.1%), non-metallic mineral products (-3.2%).
Among the major economic categories, also against the previous year, the sharpest reduction was in capital goods (-5.9%): the third negative rate in a row in this type of comparison and the highest in this sequence. In the formation of the December index, the segment was influenced by the decreases sees in the groups of capital goods for transportation equipment (-8.0%) and for agriculture (-34.8%), mainly pushed by the lower manufacture of trucks, tractor trucks for trailers and semi-trailers, ships for the transportation of passengers or cargo (including platforms and tankers) and car wagons for the transportation of cars and goods, in the first one, and of agricultural tractors and harvesters in the second one.
Conversely, the positive impacts were registered by the groups of capital goods for electricity (10.2%), for construction (5.8%), for industrial use (0.8%) and for mixed use (1.9%).
The sector producing intermediate goods fell 2.1% in terms of the monthly index of December 2019 and recorded the second negative rate in a row in this type of comparison. This month result was attributed mainly to the drawbacks seen in the mining and quarrying industries (-12.2%), Basic metals (-10.4%), food products (-4.1%), machinery and equipment (-8.9%), of non-metallic mineral products (-3.3%), of Pulp, Paper and Paper Products (-4.0%) and of other chemicals (-0.8%), whereas the positive pressure came from coke, petroleum products and biofuels (16.2%), Motor Vehicles, trailers and semi-trailers (5.4%), textiles (9.5%) rubber and plastic (2.0%) and fabricated metal products (1.9%).
Also in this economic category, it is worth mentioning the results recorded by the group of typical input for civil construction (-0.3%), which interrupted three consecutive months of production growth; and of packaging (3.8%), which had the highest rate since May 2019 (21.0%).
The segment of durable consumer goods increased 1.6% in the monthly index of December 2019 over the same period in the previous year, recording the fourth consecutive positive figure in this type of comparison. This month, the sector was particularly leveraged by the expansion in the manufacture of brown goods in household appliances (21.7%), due to the higher production of TV sets. It is also worth mentioning the advances seen in motorcycles (4.1%) and by the group of other household appliances (25.3%).
on the other hand, the reduction in the manufacture of cars (-3.4%) exerted the highest influence in this category. The other negative impacts were recorded by the groups of white goods in household appliances (2.0%) and of furniture (-0.3%).
The segment of semi- and non- durable consumer goods advances 1.2% in December 2019 over the same period in the previous year, after also growing last September (2.0%), October (3.6%) and November (0.9%) The performance this month was explained, to a great extent, by the expansions reported in the groups of food and beverages for domestic consumption (3.1%) and semi-durables (6.4%).
On the other hand, the subsectors of non-durable (-3.4%) and and fuel (-5.7%) pointed to negative rates in this category, pressured, to a great extent, by the lower production of medicines, powder soaps or detergents and softeners, in the first; and ethyl alcohol, in the second.
In the fourth quarter of 2019, industry fell 0.6%
The industrial sector, with a decrease of 0.6% in the fourth quarter of 2019, remained with the negative behavior observed since the last quarter of 2018 (-1.3%), all comparisons against the same period of the previous year. The reduction in the intensity of loss in total industrial production from the third (-1.2%) to the fourth (-0.6%) quarter of 2019 was explained by the dynamism seen in three of the four major economic categories, with a highlight to durable consumer goods (from 1.1% to 3.3%).
The segments of semi and non-durable consumer goods (from 1.0% to 2.0%) and intermediate goods (from -2.4% to -1.5%) also made this movement, with semi and non-durable consumer goods reporting the third consecutive quarter of growth in production; and intermediate goods with a less intense loss in the sequence of five quarters of negative results. The sector of capital goods (from 1.2% to -3.5%) was the only one that showed a loss of pace between the two periods, thus interrupting two quarters in a row of positive rates.
In 2019, industry accrues drop of 1.1%
Compared with the January-December period of 2019, against the same period a year ago, the industrial sector decreased 1.1%, registering negative figures in the two of the four major economic categories, 16 out of the 26 sectors, 40 out of the 79 groups and 54.2% of the 805 products surveyed.
Among the activities, mining and quarrying industries (-9.7%) exerted the biggest negative influence on the industry average, driven, to a great extent, by the item iron ore. It is also worth highlighting the negative contributions reported by: basic metals (-2.9%), pulp, paper and paper products (-3.9%), maintenance, repair and installation of machinery and equipment (-9.1%), other transportation equipment (-9.0%), Pharmaceutical Products (-3.7%), wood products (-5.5%), toiletry, soaps, cleaning and personal care products (-3.7%) and rubber and plastic products (-1.5%).
However, among the ten activities that increased the production, the major influences on the whole industry were recorded by food products (1.6%), motor vehicles, trailers and bodies (2.1%), coke, petroleum products and biofuels (1.7%), fabricated metal products (5.1%) and beverages (4.0%).
Among the major economic categories, the profile of the results for the twelve months of 2019 showed less dynamism for intermediate goods (-2.2%), influenced, mainly, by the reduction verified in extractive industries (-9.7%), explained, mainly due to the effects of the rupture of a mining tailing dam in the Brumadinho region (MG) in January 2019.
The capital goods segment (-0.4%) also showed a negative rate in the cumulative index in the year. On the other hand, the sector of durable consumer goods (2.0%) posted the sharpest rise, leveraged, to a great extent, by the increased manufacture of white goods (10.7%). The segment of semi-durable and non-durable consumer goods (0.9%) also closed the year of 2019 with production growth.