The exchange with Brazil fell more than 7% in October due to the drop in imports and exports

So, Argentina accumulates ten consecutive months of deficit with the neighboring country. This situation had not been observed since 2018, the last period with more than ten months of the year with a trade deficit (at that time there were eleven consecutive months that showed a negative bilateral balance).

In the first ten months of the year, the negative balance for Argentina in its exchange with Brazil was for US$2,328 million because the exports grew 16.2% in 2022 with respect to ten months of 2021, while the imports from Brazil increased by 36.2% in the same period.

The year-on-year decrease in exports from Argentina to Brazil registered in October (-4.1%) responded mainly to fall from wheat and unground rye, unground cornexcept sweet corn, petroleum fuels or bituminous minerals, fats and vegetable oils and ethylene polymers.

On the other hand, the year-on-year increase in Argentine imports (34.7%) It was mainly explained by passenger motor vehicles, vehicle parts and accessories automotive, iron oresits concentrates and piston engines and civil engineering and construction installations and equipment.

Argentina was positioned in fourth place among the elders Brazilian suppliersin back of China and Hong Kong and Macao (US$5,476 million), USA (US$4,521 million) and Germany (US$1,180 million). In turn, among the main buyers from Brazil, Argentina ranked third, in back of ChinaHong Kong and Macau ($6.768 billion) and USA (US$3.165 million).

The Brazilian exports to the world increased by 20.8% in October 2022 compared to the same month in 2021, going from US$ 22,603 ​​million to US$ 27,299 million. For its part, total imports grew by 13.8% compared to those registered a year ago (US$ 20,539 million in 2021 vs. US$ 23,378 million this year). Thus, the Brazilian trade result was in surplus —for the ninth consecutive month— at US$3,921 million, a situation similar to that observed in October 2021, although with a higher nominal value: in 2021 the positive balance had been US$ 2064 million.

The market expectations revealed in October by the Central Bank of Brazil improved from the previous month in growth matter expected for 2022(2.76% against 2.70%). Likewise, the expectation about the rise in prices decreased to 5.61%, from the 5.74% annual rate of the previous month. Likewise, they expect the Selic interest rate level to remain at the current 13.75%.

Looking ahead to the coming months, the scenario may become more complicated since Brazil will have to look for alternative wheat sellers because the loss of the Argentine harvest due to drought has reduced production and compromised its export capacityanalysts said, pointing to the United States, Canada and even Russia as potential suppliers.

The Government points to the triumph of the president-elect Luiz Inacio ‘Lula’ da Silva relaunch links with the main regional economy, mainly in terms of energy integrationinfrastructure projects and the need to add value to the production of both countries.

The exchange with Brazil fell more than 7% in October due to the drop in imports and exports