In the seasonally-adjusted series, the industrial output advanced 0.4% in January 2016 over December,
interrupting seven consecutive months of drop, when it registered a cumulative loss of 8.7%. The quarterly moving average declined (-0.9%) in the same comparison. The industry recorded the 23rd consecutive negative rate (-13.8%) in this comparison and the most intense since April 2009 (-14.1%). The cumulative index in the last 12 months (-9.0%) posted the sharpest drop since November 2009 (-9.4%) and maintained the downward trend started in March 2014 (2.1%).
The complete publication of the Monthly Survey of Industry (PIM-PF) can be accessed here.

In January 2016, the industrial sector was again increasing the output pace, expressed not only by the advance of 0.4% when compared with the immediately previous month – which interrupted seven consecutive months of drop –, but also by the predominance of positive rates among the major economic categories and the activities surveyed. Even considering the positive figure in January, the industry overall recovered only a small part of the cumulative loss of 8.7% in the June-December 2015 period and was still 19.2% below the record level hit in June 2013. Still in the seasonally-adjusted series, the signs of reduced industrial activity remained in the evolution of the quarterly moving average index (-0.9%), which continued the downward trend started in October 2014, even reducing the pace of decline in the last three months.

Industrial Output Indicators by Major Economic Categories
Brazil - January 2016

Source: IBGE, Diretoria de Pesquisas, Coordenação de Indústria
*Seasonally-adjusted series

Compared with the same month a year ago, the industrial output remained dropping in January 2016, registering the 23rd consecutive negative figure with the predominance of negative rates among the major economic categories and the activities surveyed, highlighted by the declines in the sectors associated with the manufacture of capital goods and durable consumer goods.

Industry grows 0.4% in relation to December

The expansion of 0.4% in the industrial activity between December 2015 and January 2016 showed positive figures in three out of the four major economic categories and in 15 out of the 24 sectors surveyed. Among the sectors, the main positive influence was recorded by coke, petroleum products and biofuels, which advanced 2.8%, posting the second consecutive positive rate and registering a cumulative expansion of 6.6%. It should be highlighted that these positive results offset part of the cumulative reduction of 8.0% in the October-November 2015 period.

Other important positive contributions to the industry overall came from the activities of electrical machinery and apparatus (6.1%), beverages (3.8%), machinery and equipment (3.1%), tobacco products (24.5%), textiles (7.1%), toiletries, soaps, cleaning and personal hygiene products (1.4%), fabricated metal products (2.7%) and furniture (7.8%). Except for this last activity, which expanded for the third consecutive month and recorded a cumulative rate of 12.0% in the period, the others posted negative rates last December: -9.0%, -8.9%, -9.2%, -7.9%, -9.8%, -3.5% and -5.6%, respectively.

Among the nine sectors that reduced the production in January, the most important performance for the overall average was registered by mining and quarrying industries. Having declined 2.7%, it recorded the fourth negative figure in a row and posted a cumulative reduction of 15.2% in this period. Other important negative impacts were reported by the sectors of food products (-0.6%), motor vehicles, trailers and bodies (-1.0%) and computer equipment, electronic and optical products (-3.6%). The first sector offset part of the advance of 1.8% registered in the previous month; the second interrupted two consecutive months of positive rates and recorded a cumulative growth of 4.2%; and the last sector returned part of the expansion of 10.3% posted in December 2015.

Having advanced 1.3% and 0.8%, respectively, capital goods and intermediate goods registered the steepest expansions in January 2016 over the immediately previous month. The former offset a small part of the cumulative loss of 12.9% between October and December last year; and the latter repeated the result of the previous month, when it interrupted ten consecutive months of drop in the production and recorded a cumulative reduction of 10.4% in this period. The sector producing semi and non-durable consumer goods (0.3%) also registered a positive rate in January, recording the third consecutive expansion and a cumulative gain of 0.8% in this period, yet not offsetting the retreat of 1.1% posted in October 2015.

The segment of durable consumer goods (-2.4%) registered the only negative figure in January 2016, after advancing 8.0% in the previous month, when it interrupted four consecutive months of reduced production, a period in which it recorded a cumulative loss of 18.0%.

Still concerning the seasonally-adjusted series, the evolution of the quarterly moving average index for the overall industry declined 0.9% in the quarter ending in January 2016, against the level of the previous month, keeping the downward trend started in October 2014. Among the major economic categories, capital goods (-3.3%) reported the sharpest drop in January and maintained the sequence of negative rates started in October 2014, a period in which it registered a loss of 38.6%. The sector of intermediate goods (-0.6%) also declined in January and kept the downward trend started in September 2014.

Conversely, the segments of durable consumer goods (0.7%) and semi and non-durable consumer goods (0.2%) registered positive rates in January 2016. The former segment interrupted 13 consecutive months of drop and recorded a cumulative reduction of 30.5%; the latter returned to grow after showing a negative behavior since July 2015.

Industry declines (-13.8%) in relation to January 2015

Compared with the same month a year ago, the industrial sector dropped 13.8% in January 2016, pointing to a widespread profile of negative figures and reaching the four major economic categories, 23 out of the 26 sectors, 70 out of the 79 groups and 77.9% out of the 805 products surveyed. It is worth highlighting that January 2016 (20 days) had one business day less than the same month a year ago (21). Among the activities, motor vehicles, trailers and bodies (-31.3%) and mining and quarrying industries (-16.8%) exerted the greatest negative influences on the average industry, pressed, at a large extent, by the items cars, trucks, vehicles for transportation of goods, bodies for buses and trucks, trailers and semi-trailers, car pieces, tractor trucks for trailers and semi-trailers and chassis with engine for buses and trucks, in the former activity, and iron ores and crude petroleum oil, in the latter.

Other relevant negative contributions to the national overall came from machinery and equipment (-25.5%), computer equipment, electronic and optical products (-38.8%), basic metals (-15.3%), food products (-5.8%), electrical machinery and apparatus (-23.0%), non-metallic mineral products (-14.9%), rubber and plastic products (-14.4%), fabricated metal products (-16.1%), beverages (-11.2%), other transportation equipment (-25.3%), other chemicals (-6.4%), printing and reproduction of recorded media (-29.4%) and textiles (-20.2%).

Still comparing with January 2015, tobacco products (21.5%) and pulp, paper and paper products (1.0%) were the two activities that increased the production in January, leveraged, at a great extent, by the advances in the items cigarettes, in the former activity; and chemical pulp, in the latter.

Still comparing with the same month a year ago, capital goods (-35.9%) and durable consumer goods (-28.2%) registered the steepest declines among the major economic categories in January 2016. The sectors producing intermediate goods
(-11.9%) and semi and non-durable consumer goods (-7.2%) also recorded negative rates in January, yet below the national average (-13.8%).

Having retreated 35.9% in the monthly index of January 2016, the sector producing capital goods posted the 23rd consecutive negative rate and the sharpest since the beginning of the time series. This segment was influenced by the declines in all of its groups, highlighted by the reduction of 37.6% in capital goods for transportation equipment, mainly pressed by the reduced manufacture of trucks, vehicles for transportation of goods, ships for transportation of persons and cargo (including oil tankers and oil platforms), trailers and semi-trailers, tractor trucks for trailers and semi-trailers, wagons for transportation of goods, and buses. The other negative rates were registered by capital goods for industrial use (-15.2%), for mixed use (-40.3%), for construction (-58.2%), for agriculture (-32.0%) and for electricity (-23.0%).

The segment of durable consumer goods declined 28.2%, registering the 23rd consecutive negative figure in this type of comparison and the most intense than that reported in the previous month (-25.7%). In January, this sector was particularly pressed by the reduced manufacture of cars (-22.2%), brown goods (-42.1%), and white goods (-24.6%), influenced, at a great extent, by reduced shifts and collective vacations in a number of producing units. Other important negative impacts came from motorcycles (-36.9%), furniture (-21.4%) and other household appliances (-21.7%).

Still comparing with the same month a year ago, the production of intermediate goods
(-11.9%) recorded the 22nd consecutive negative rate and the sharpest since May 2009 (-12.7%). The January´s result was mainly explained by the declines in the products associated with the activities of mining and quarrying industries (-16.8%), motor vehicles, trailers and bodies (-27.4%), basic metals (-15.3%), non-metallic mineral products (-14.9%), rubber and plastic products (-14.3%), food products (-7.5%), fabricated metal products (-15.2%), other chemicals (-6.4%), textiles (-21.0%), coke, petroleum products and biofuels (-0.9%) machinery and equipment (-4.2%), whereas the positive pressure came from pulp, paper and paper products (1.1%). Still in this economic category, it is worth mentioning the reductions reported by the groups of typical inputs for civil construction (-19.3%), which registered the 23rd consecutive retreat in the comparison against the same month last year, and of packaging (-9.6%), which recorded the 13th consecutive negative rate and the most intense since the beginning of the time series.

The reduction in the production of semi and non-durable consumer goods (-7.2%) in January 2016 was the 15th consecutive negative rate in the comparison with the same month a year ago, posting a more intense drop than those registered in November
(-5.5%) and December (-5.2%). The performance in January was explained by the retreats in the groups of food and beverages for domestic consumption
(-6.0%), semi-durable (-14.0%) and non-durable (-9.1%). On the other hand, the subsector of fuels (3.2%) recorded the only positive figure in this category, leveraged by the increased manufacture of motor gasoline and ethyl alcohol.

The signs of reduction in the output pace of the industry also became evident when comparing the last quarter of 2015 (-11.9%) with the first month of 2016 (-13.8%), both of them compared with the same periods in the previous year. Among the major economic categories, capital goods (from -32.0% to -35.9%) and intermediate goods (from -9.7% to -11.9%) posted the highest reduction between the two periods. The former registered the highest loss, and the latter stepped up the pace of decline in the mining and quarrying sector (from -7.4% to -16.8%). The segments of semi and non-durable consumer goods (from -6.3% to -7.2%) and durable consumer goods (from -27.9% to -28.2%) also registered a deceleration in the pace between the last quarter of 2015 and January 2016.

Social Communication
4 March 2016