Despite a 24.6% drop, 2024 posts second-best performance; exchange rate and U.S.-China tensions add to doubts
01/07/2025
Brazil’s trade surplus for 2024 reached $74.55 billion, a 24.6% drop from the record-breaking $98.9 billion in 2023. Despite the decline, 2024 still secured the second-highest trade surplus since official records began, in 1997, according to the Ministry of Development, Industry, Trade, and Services (MDIC). Looking ahead to 2025, experts foresee a surplus comparable to or slightly better than 2024, though still significantly below the peak achieved in 2023.
According to the Ministry’s Foreign Trade Secretariat (SECEX), 2024 saw $337 billion in exports and $262.48 billion in imports. Declining commodity prices and a rise in imports contributed to the smaller surplus.
For 2025, a slower domestic economy is expected to curb imports, while an anticipated strong agricultural harvest could boost exports. However, uncertainty persists regarding export prices, exchange rate, and the impact of renewed U.S.-China trade tensions, especially as President Donald Trump assumes office on January 20.
“Given the expected good harvest, the surplus should remain at 2024 levels or potentially reach $80 billion if the domestic slowdown materializes,” said Lucas Barbosa, an economist at AZ Quest. He projects imports will stabilize near the 2024 level of $262 billion, while exports could rise to $350 billion.
Similarly, Gabriela Faria, an economist at Tendências Consultoria, forecasts a $77.6 billion surplus for 2025. She expects a 1.6% drop in export values due to declining prices but notes potential gains in volume, particularly from minerals, oil, and grains. Domestic grain production is projected to grow 8.2% over the 2023/24 cycle, with soybeans poised to reach record levels, according to estimates from Brazil’s National Supply Company (CONAB).
On the import side, Tendências projects a 3.1% decline in 2025 due to weaker domestic activity. Tightened financial conditions, increased internal uncertainties, slower global growth, and reduced fiscal stimulus form the basis for Tendências’s GDP growth estimate of 1.9% for this year, down from 3.4% in 2024, according to Ms. Faria.
Mr. Barbosa of AZ Quest cautioned that the exchange rate remains a significant challenge. “A dollar trading above R$6 favors exports, especially of goods that might otherwise be consumed domestically. For example, animal protein becomes increasingly attractive for export,” he said.
Herlon Brandão, director of foreign trade statistics at the MDIC, anticipates imports in 2025 will remain at or exceed 2024 levels, supported by Brazil’s projected economic growth. He also noted that there are no significant indications of large commodity price fluctuations.
On the export side, Mr. Brandão expects global economic growth to increase demand for Brazilian goods, particularly food products like soybeans and meat. “As the agricultural harvest recovers”, he said, soybeans should reclaim their position as the top export product, replacing oil. SECEX forecasts a trade surplus for 2025 ranging from $60 billion to $80 billion.
Industry concerns
The wide range in SECEX’s projections reflects the unpredictable nature of 2025, said José Augusto de Castro, president of the Brazilian Foreign Trade Association (AEB). His preliminary estimate points to a $93 billion surplus, assuming moderate price increases and volume growth. Commodity prices, he said, are sensitive and can react to any external events. “AEB’s projections come with many caveats,” he noted. Mr. Castro also highlighted uncertainties surrounding U.S.-China trade relations and their potential impact on global markets, alongside concerns about the exchange rate.
Tatiana Prazeres, foreign trade secretary at the MDIC, described 2024’s trade performance as positive, highlighting the “sustained high level of exports.” The decline in export value, she said, resulted from lower product prices, despite a 3% increase in export volumes. SECEX data showed a 0.8% drop in export value for 2024, driven by a 3.6% fall in prices.
Mr. Barbosa of AZ Quest highlighted notable export products in 2024, including beef, pork, sugar, molasses, and coffee. While many of these goods suffered price declines, increased export volumes more than offset the impact.
Welber Barral, a partner at BMJ consulting, noted that the price drop in 2024 was primarily driven by commodities. “Imports, particularly capital goods, increased—a positive sign. Although the surplus fell by nearly 25%, it’s still impressive given Brazil’s historical performance. “A similar pattern could emerge in 2025, with imports expected to continue rising despite the strong dollar,” he said, citing anticipated GDP growth of around 2% even amid an economic slowdown.
Mr. Barbosa of AZ Quest added that 2024’s trade surplus aligned with initial expectations, but the resilience of imports was surprising. SECEX data showed import volumes grew 17.2% in 2024, while prices declined by 7.4%. “The volume data reflects robust domestic demand, which continues to flow outward via imports, particularly of capital goods and consumer goods,” he explained.
Capital goods imports were particularly strong, aided by lower prices, Mr. Castro of AEB noted. Government data showed that capital goods imports rose 20.6% in value in 2024, driven by a 25.6% increase in volume and a 4.7% price decline.
*By Estevão Taiar e Marta Watanabe — Brasília, São Paulo
Source: Valor International