Brazilian furniture production rises 3%

Source:Z&L Furniture Add Time:2014-01-07

Reports indicate that national furniture production fell by almost 2% in September but for the first three quarters of 2013, there was a 3.2% increase in output compared to the same period in 2012. In the state of Rio Grande do Sul during August and September furniture manufacturers reported a 5.6% increase in output which equates to the production of some 7.8 million items.

However for the first three quarters of the year output from manufacturers in Rio Grande do Sul declined 0.4% compared to the same period in 2012. Furniture retail sales also fell by around 9% in terms of items sold and by 8% in terms of revenue. However, the figures for the first three quarters of the year are more encouraging as retail sales increased 5.5% in number of items and by 8.6% in terms of value.

Investment in the furniture sector in the first six months of the year, the latest for which data is available, increased 48%, in comparison with the same period in 2012. The Brazilian Development Bank (BNDES) disbursed some US$95 million for investment in the furniture sector up to July this year. In other encouraging news, Brazilian imports of wood working machinery for the furniture sector increased almost 6% up to October of this year compared to the same period in 2012.

Rio Grande do Sul state remains furniture export leader

The state of Rio Grande do Sul remains the leader amongst Brazilian states exporting furniture with US$171.5 million being exported between January and October this year. The main export destinations for furniture manufactured in Rio Grande do Sul were the United Kingdom (US$24.8 mil.), Uruguay (US$21.7 mil.) and Peru (US$20 mi.).

Total Brazilian furniture exports between January and October were US$588.3 mil. and the main market was Argentina. According to the Furniture Industries Association of State of Rio Grande do Sul (Movergs), the state manages to hold onto its number one position because manufacturers benefit from a programme to compensate exporters for the high tax burden and from government incentives. However, the advantage to exporters is threatened as the government plans to end the ―Reintegra‖ programme through which it returns 3% of the value of exports to exporters.

The states of Santa Catarina and Paraná are the second and third ranked in terms of furniture exports with sales of US$154.7 mil. and US$100.7 mil. up to October this year. In fourth place is Bahia state where exports this year fell13% compared to 2012. The data on exports are reported by Movergs in collaboration with the Furniture Management Center for Innovation (CGI Moveleiro) and are based on Ministry of Development, Industry and Foreign Trade (MDIC) data.