Brazil’s trade surplus shrinks by nearly a quarter in 2024 on rising imports

4:12 pm Monday, January 06th, 2025

By Marcela Ayres

BRASILIA (Reuters) -Brazil’s trade surplus shrank by nearly 25% in 2024 compared to the previous year, to $74.6 billion, official data showed on Monday, driven by higher imports as Latin America’s largest economy outpaced initial growth expectations.

The annual result followed a $4.8 billion surplus in December, which exceeded a $3.9 billion forecast in a Reuters poll of economists.

Despite the 24.6% drop from 2023, the 2024 trade surplus was the second-largest since records began in 1989, trailing only the $98.9 billion surplus achieved the previous year.

Exports remained largely flat, falling 0.8% from 2023 to $337 billion, impacted by lower prices and volumes for key Brazilian commodities such as soybeans and corn, with iron ore also experiencing a year-over-year decline due to price factors.

These moves overshadowed the rise in crude oil shipments, which became Brazil’s top export in 2024 – a position the government does not expect to sustain moving forward.

“As the agricultural harvest recovers, it is likely that soybeans will regain the top spot, especially as soybean prices begin to rebound,” said Herlon Brandao, director of Statistics and Foreign Trade Studies at the Ministry of Development, Industry, Trade, and Services.

Conversely, Brazilian imports rose 9% in 2024 over the previous year, to $262.5 billion, buoyed by strong domestic demand and increased investments, particularly in the acquisition of capital goods.

Economic activity consistently outperformed expectations throughout the year, with the government estimating gross domestic product growth of 3.5% for 2024.

For 2025, the trade surplus is projected to range between $60 billion and $80 billion, according to the Ministry of Development, Industry, Trade, and Services.

With the global focus on the potential impact of tariffs promised by U.S. President-elect Donald Trump, Brazil’s Secretary of Foreign Trade, Tatiana Prazeres, noted that while Brazil maintains a surplus in its overall trade balance, it continues to face a deficit with the United States.

“Therefore, under this criterion, Brazil should not be a primary concern for the U.S. government,” she said.

According to Prazeres, Brazil will rely on its various mechanisms for dialogue with the U.S. to strengthen trade ties in the coming years.

(Reporting by Marcela Ayres; Editing by Brendan O’Boyle and Aurora Ellis)