Brazilian market sees 11% contraction in April

Cement sales in Brazil declined 11.4 per cent YoY to 4.577Mt in April 2023 from 5.164Mt, according to the Brazilian cement association, SNIC. The association attributed the market contraction to rising unemployment, a slow recovery of wages and high interest rates (currently at 13.75 per cent), which all led to a drop in building material sales and a fall in real estate launches and financing.

“The results point to a worrying performance of the cement industry in view of the discussions on the Basic Sanitation Law, the fiscal framework, uncertainties regarding the evolution of the Tax Reform and the lack of perspective of a reduction in the basic interest rate. In addition, there is still strong pressure on the cost of inputs that are part of the sector's production process,” said SNIC President, Paulo Camillo Penna.

Sales in the north were most affected with the region noting a 15.2 per cent YoY drop to 0.179Mt in April 2023. The central-western market contracted by 14.9 per cent YoY to 0.544Mt. The key southeast sales region, the largest in the country, reported an 11.2 per cent drop YoY to 2.172Mt while a similar decline was reported for the south, where off-take fell to 0.789Mt in April 2023. In the northeast, sales contract by 8.9 per cent YoY to 0.893Mt.

Exports were down by 43.3 per cent YoY to 17,000t in April 2023 from 30,000t.

January-April 2023
In the January-April 2023 period domestic sales in Brazil were down 3.1 per cent to 19.339Mt from 19.955Mt in the 4M22.

The largest contraction took place in the central-western sales region where sales fell by 6.7 per cent to 2.144Mt in the 4M23 from 2.299Mt in the equivalent period of the previous year. In the north and south, sales declined by approximately four per cent to 0.815Mt and 3.41Mt, respectively. In the southeast 8.976Mt of cement was sold, down 2.6 per cent from 9.214Mt in the 4M22. The northeastern market saw sales slip by 1.1 per cent to 3.994Mt in the 4M23 when compared with the 4M22 sales of 4.039Mt.

Exports in the first four months of 2023 dropped to 75,000t, down 47.9 per cent YoY from 144,000t.