Trade

Brazilian footwear exports slowdown

Apr 26, 2023 Brazil

In March, Brazil's footwear exports declined by 11.4% in volume and by 2.6% in value, as compared to the same month of 2022, reflecting the slowdown of the global economy

According to the Brazilian Footwear Industries Association (Abicalçados), last month, the South-American country shipped 11.67 million pairs of shoes worth 108.6 million US dollars, down by 11.4% in volume and 2.5% in value, on a comparable basis to March 2023. Abicalçados' Executive President pointed out that this decline follows the slowdown in the global economy, which “with high inflation rates, undermines the growth of manufacturers of discretionary consumer goods”.

But overall, in the first quarter of the year, Brazil exported 38.44 million pairs of shoes, generating 328.44 million US dollars. These figures reflect a decline in volume of 5.7% and an increase in value of 2.4%, as compared to the same three months of the previous year.

Haroldo Ferreira warned once more on the increasingly tougher international competition following the reopening of China's economy after the removal of COVID-19 restrictions, along with the drop in the cost of international freight. Last year, the Brazilian footwear industry benefited from the demand from close-by countries at the expense of Asia.

Main Destination Markets

In the three months to the 31^stof March, exports to the US, Brazil's main market, suffered notably as a result of the abovementioned global slowdown as well as the growth in the level of inventories. In particular, the country shipped 2.9 million pairs of shoes worth 56.87 million US dollars, which indicates a decline of 51.5% in volume and 35.9% in value, on a comparable basis to the same period of 2022.

Argentina remained the second destination market for Brazilian footwear in the first three months of the year, purchasing 3.23 million pairs of shoes worth 55.32 million US dollars. These figures reflect a 1.4% increase in volume and 52.8% in value year-over-year.

Spain, which surpassed France in this ranking, figures in 3^rdplace. In the first quarter of the current fiscal year, Brazil exported 5.75 million pairs of shoes to the European country generating 17.8 million US dollars, up by 265.6% in volume and 272.2% in value, respectively, as compared to the first quarter of 2022.

Brazilian Footwear Industry

The World Footwear 2022 Yearbook (more information available HERE) shows that Brazil ranks 5^th among footwear producers worldwide. After a difficult 2020, the country's footwear industry recovered in 2021 driven by exports that have benefited from increased demand in the US due to the tariffs imposed on Chinese footwear, but the domestic market remains depressed.

Image Credits: Who’s Denilo ? on Unsplash

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