Brazilian Export Map: download now!

Brazil is full of diversity: from its climate to all the different regions and cultures, there’s no place quite like it in the world.

Such a big country produces massive quantities of unique products, for both internal trading and exporting. We already established a profile based on the country’s 2016 exports in this post.

What’s interesting to know is this: even with its internal challenges, exports from Brazil rose 17.5% year-on-year to USD 16.22 billion in November of 2016, according to data from Trading Economy.

Thinking about all the country’s singularities when it comes to trading and all the products it has to offer, we created an infographic containing important information about Brazil.

In the material you’ll find out more about the country’s:

  • Most sold products
  • Main taxes
  • Main Ports
  • Exclusive products
  • Main challenges and benefits when exporting

And a map showing Brazil’s biggest buyers by ranking. Don’t waste any time: Download the infographic now and learn more about the brazilian foreign trade!

5 tips to find your ideal business partner

Finding good exporters these days may sound like a difficult task: where and how to find companies that produce what you are looking to import, how to approach them, will they be open and willing to negotiate are some of the questions that will arise before you start your business plan.

However, in today’s global market, where we have Google, LinkedIn and Facebook, this does not seem to be impossible anymore. It is essential that proper research is done beforehand, which will be the basis of a 5-star business plan that will take you where you want to be.

1 – Good exporters are not necessarily located in the big cities

Brazil is a massive exporter of goods with great acceptance in first world markets. These products usually are developed outside the big cities, which guarantee a much better cost for high quality products.

Many factories in small cities are investing substantially into making sure that they are easy to be found and approached by potential new partners.

2 –Business partners will help you through the process

Established exporters will have experience working with consolidated business partners throughout several years, which can be advantageous to a first time exporter, making the whole process easier for beginners.

Do not be afraid to accept suggestions from people and companies willing to help you through the initial stages of a negotiation. Expect to spend more in the beginning in order to develop successful partnerships.

3 – Professional website and bilingual staff available 24/7

Serious exporters know that the key for doing business in a global market is communication. They invest in training all personnel, making sure the staff is able to communicate in English.

It is not uncommon to see Chinese as a growing language in the market, and nowadays more and more people are keen to learning a third language other than English.

Their website will be clean, easy to navigate and available in at least the local language plus English. This way they make sure to have open channels, replying promptly to whatever queries received, facilitating any potential business approach.

4 – don’t be afraid to invest highly in the beginning

If you are a first time importer, make sure your business plan cover its costs in the first and second year, and ensure that you are doing business with the best professionals you can find. Do your research extensively before anything else, and don’t be afraid to contact potential exporters, swamping them with as many questions as you have.

5 – They will make sure to be available and accessible, being easy to be found

Good business partners invest in media, especially focused in attracting new potential buyers. Being easy to find on the market is fundamental if they want to be approached by potential new partners. Look for them online and get to know as much as you can about them. Make sure your future business partner will be available to you whenever you need before closing any deal. This can guarantee you a steady and successful long term partnership.

brazilian exports

Brazilian exports in 2016

Although Brazilian exports in the last five years have slowed down, the main indexes indicate that one of the worst crises has already left its apex. According to the Ministry for Industry and Foreign Trade, Brazilian exports reached US$ 132,391 billion up to September 2016, which, along with USD 97,654 in imports, summed up to a positive figure of USD 34,737.
The Asian market is still the main destination of Brazilian products, growing 13% when compared to 2015, representing almost one fourth (23%) of all our exports. On the other hand, there’s been a decline in Brazilian exports towards North America, Europe and the Mercosur. Currently the country’s biggest importers are China, the US and Argentina.

Main products exported by Brazil

Let’s see which products have contributed to Brazilian exports in 2016. Soybeans represent the largest share of exports, reaching 11% of global sales, where China remains as main buyer.

The sale of basic products leverages the figures, thanks to the trade of oil and ores and their concentrates, representing 8.7% of exports. Poultry is also among the main exported products, representing 7% of sales. Beef is also represented, with nearly 5% of sales.

Manufactured products (machinery and motors), while being among the most trade products, represent 5.9% of exports, and vehicles score a 5% share. Semi-manufactured products like sugar and cellulose reach only 4% of exports in spite of the importance of these sectors. Coffee, tea and spices represent 3.2% of Brazilian
exports.

Main exporter companies

From this scenario we can analyze the main exported companies in the country. Among them we have Petrobrás, Vale and JBS. Although Vale posted a 45% decrease in exports, and Petrobrás also dipped by 35%, both still occupy the post of greatest Brazilian exporters.

Companys in the mineral and food processing sectors harbor the biggest exporters, such as Brasil Foods, Metalúrgica Gerdau, CSN and Cosan. Embraer is also among the highest foreign sellers, and one of the exceptions in showing growing sales. Itaúsa, Braskem and WEG complete the list.

What to expect of Brazilian exports?

Exports through 2016 have shown significant increase in daily sales, posting a 4.5% growth in the first half of the year. Even though still declining, when compared to previous years, there is an optimist expectation that the figures may recover, focusing in products with aggregated value for the international buyer.
The country is well regarded thanks to the commercial agreements that may favor international transactions. Exchange rates may also help in the financial strengthening of the country as it brings new exporters into play. Finally, agricultural products should be highlighted as they may leverage the country, mainly due to soybeans that have remained as a top-ranking exported product.

What is your perspective for the incoming months? Take part in the discussion leaving your comment. Sign up for our newsletter in order to receive exclusive content on Brazilian exports.

The impacts of the exchange rates on international businesses

Following the US dollar fluctuations has become a routine in the life of any professional that acts in the foreign trade area, particularly if this specialist’s international transactions involve the Brazilian territory.

Speculations destabilize the market, slow the flow of buying and selling down and make buyers lost, without knowing in which direction to go. How importing from markets where the currency is so devalued? How to make a sale to the foreign market in this current economic environment? These are questions that dominate the current scenario.

 

How does the US dollar affect economy?

Understanding how the US dollar affects the economy is a crucial point because this is the currency that will be taken as a reference in commercial transactions.

It is assumed that the US dollar will affect all the other currencies and, thus, that its drop or its increase shall set the shape of the rest of the market. When the US currency is valued against the Brazilian Real it is the time to invest in sales to the international market and when the US dollar devalues, it means the moment is favorable for buying from foreign markets.

 

We can deduce from this that, to the exporter, it is beneficial that the Brazilian Real is devalued. With the current volatile market, with the Brazilian currency devalued, exporters can negotiate and put a better price on their products, to the extent that, in Brazil, the foreign currency will be worth more on par with the Brazilian currency. In plain language, the US dollars will render greater purchasing power to exporters that will receive payments in US dollars and reverse their profit in Brazilian Reais. The importer, in turn, will be able to acquire a product with a value below his/ her local currency.

Currency exchanges as Brazilian’s main ally

Currency exchange rates variations can be attractive to buyers who want to invest in Brazil, especially for importers who want to invest in cellulose, on the footwear and on the textile sectors. The input becomes so competitive to the point that it can be considered equivalent to the Asian market. Although the workforce can be more expensive compared to other foreign markets such as China and India, for example, thanks to the strength of the United States dollar and the devaluation of the Brazilian Real, the price of the final product is an advantage in foreign markets.

In June 2016 Brazil reached a deficit of 2.479 million dollars. The Central Bank predicts that, by the end of the year, this deficit will be of about 15 billion dollars in transactions. However, with a trade balance governed only by exports, we may have an economic imbalance, as foreign capital enters, but few inputs are purchased by imports.

Both exporters and importers expect a balance, but very pessimistic hopes are being observed throughout the months of 2016. We must be attentive to the movement of foreign exchanges and set a pugnacious behavior in order to make it possible to design the monetary scenario, based mainly on the US dollar, the currency that governs all the monetary policy, and hope that, this way, it will be possible to expand business and have purchasing power abroad.

What makes Brazil an excellent exporter?

Over the past years Brazil has been showing itself as an excellent exporter. On April, 2016 Forbes magazine 2015 Global 2000 rankings  published that exports from Brazil amounted to US$191.1 billion in 2015 and represented 6.2% of the total Brazilian economic output.

Most of the Brazilian exports are delivered to Asian and European importers. The country also sells a great amount of goods to Latin America (excluding Mexico), to Caribbean nations and to African and North American continents.

Brazil’s Top 10 Exports:

1. Oil seed
2. Ores, slag, ash
3. Oil
4. Meat
5. Machines, engines, pumps
6. Vehicles
7. Iron and steel
8. Sugar
9. Food waste, animal fodder
10. Coffee, tea and spices

The most recent Intercâmbio Comercial do Agronegócio (Ministério da Agricultura) reinforced that Brazil is already seen worldwide as an excellent exporter and pointed out that, currently, the country’s strongest competitive advantages are on the international trade field known as Agribusiness.

Agribusiness in Brazil:

The Agribusiness plays an expressive role in Brazil’s economy. The country occupies remarkable positions on the global agroindustry rank:

Number 1 – global producer of coffee, sugar and orange

Number 1- sugarcane producer and leader on the sugar and ethanol global exports

Number 1- poultry and meat exporter

Number 2 – soybeans producer          

Brazil is a country with natural vocation for agribusiness due to its characteristics and diversities. With its 8.5 million kilometers, Brazil has potential for expanding its agricultural capacity without harming the environment.

 

Favorable attributes:

  • Availability of agricultural land
  • Water abundance
  • Cutting-edge technology
  • High level of natural brightness
  • Favorable weather
  • Land relief characteristics

Challenges to be beaten:

  • Logistic and infrastructure issues
  • Complexity of The Brazilian Tax Legislation
  • Lack of financial resources
  • Business management deficiencies
  • Unprepared labor

 

Brazilian Exclusivities:

Fruits

Brazil is one of the top fruit producers in the world. It is estimated that there are, at least, 300 kinds of fruits in Brazil. Besides its exotic exclusively native fruits, such as Guaraná and Açaí, which grow only in the Amazon region and are exported to the rest of the planet, there is a wide variety of fruits, for example oranges and kiwi, that are not native to Brazil but have been introduced to the country as they grow in greater abundance in Brazilian soil.

Cachaça

Cachaça is a distilled beverage made from the fresh-pressed juice of sugarcane. Also known as aguardentebranquinhacaninha and some other ‘nicknames’, it is Brazil’s national (alcoholic) spirit.

According to the Instituto Brasileiro da Cachaça (IBRAC), cachaça is officially recognized as a distinctive product of Brazil and one of the export products promoted by the Brazilian government’s economic growth initiative. The ‘Brazilian Spirit’ is the leader of Brazil’s exports in this product category, but, unfortunately, at present, only 1% of all the cachaça produced in Brazil is exported.

The country intends to raise this volume to 10% until 2018 though.

Havaianas

Havaianas is a brand of flip-flop sandals owned by the Brazilian manufacturing company Alpargatas. It became a global brand and achieved the position of the most popular flip-flops in the world, producing 150 million pairs every year.

Nowadays considered a fashion item (adopted even by international celebrities), Havaianas flip-flips are very present in overseas markets.  The brand exports 10% of its Havaianas production (about 162 million pairs/ year) to more than 80 countries from the five continents of the world.

Natural Cosmetics

Brazil is not only a significant exporter of agricultural products but also an important supplier of raw materials for cosmetics. International brands that produce certified nature-based cosmetics have been experiencing a growing demand lately.

Some Italian, Russian and French brands have famous formulations that are manufactured using Brazilian raw materials. The abundance of natural raw material in Brazil has even led some of these companies to move their basis to the country.

The Brazilian market for controlled ‘natural cosmetics’ and ‘nature-based cosmetics’ represents a share of 18% of the worldwide turnover (about US$ 29.5bn).

It is clear that Brazil has a formidable growth potential to become an excellent exporter in lots of areas that the country does not focus on. Given the size of the country, its economic and business potential, Brazil has most of what is necessary to make a difference in this ‘new world’.

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