Between September and October, Brazilian industrial production fell by 0.2%, with a slowdown in four of the 15 places surveyed by the Regional Monthly Survey of industry (PIM). The biggest drops were recorded in Rio Grande do Sul (-1.4%) and Rio de Janeiro (-1.3%). Compared to October 2023, the industry grew by 5.8% and positive rates were recorded in 16 of the 18 locations surveyed. In the 12-month period, there was an increase of 3.0%, with 17 of the 18 locations analyzed showing positive results, while the cumulative index for the year expanded by 3.4%, with positive results in all 18 places observed. The national industry is 2.6% above its pre-pandemic level. The data was released today (13) by the IBGE.

“The negative performance of industry in October, after two months of growth when it accumulated a gain of 1.2%, is linked to some macroeconomic factors. On the one hand, we have the positive effect generated by the booming in the job market, with a significant reduction in unemployment and an increase in hiring and average income, on household consumption. In addition to increasing household income, this benefits the production chain. On the other hand, high interest rates, making credit more expensive, have a negative impact on household consumption and, from the supply perspective, on the investment in industrial production. Inflation has also been affecting purchasing power, causing a reduction in demand and affecting the pace of industrial production”, explains Bernardo Almeida, analyst of Regional PIM.

The highlight of October in absolute terms and second place in negative influence, was the poor performance of the Rio Grande do Sul industry (-1.4%), eliminating part of the 2.0% increase recorded in the previous month. The sectors of tobacco products; chemical products; and pulp, paper and paper products were the ones that contributed most to this result.

The biggest negative influence in October was the industry of Rio de Janeiro (-1.3%), which ranked second in the ranking of biggest declines in industrial production, marking the second consecutive month of decline in production. During this period, it accumulated a reduction of 3.0%. The main factors responsible for the performance of the industry in Rio de Janeiro were the mining and quarrying, and machinery and equipment sectors.

São Paulo, the largest industrial park in the country, grew 2.0% from September to October, the biggest positive influence on the result of the national industry. This is the second consecutive positive rate for the industry in São Paulo, accumulating a gain of 3.1%. “The sectors of motor vehicles; chemical products; and electrical machinery, appliances and materials were the ones that most influenced the dynamics of the industry in the state. This result leaves the industry in São Paulo 3.8% above its pre-pandemic level and 19.5% below its highest level, reached in March 2011”, says Mr. Almeida.

Amonhg the highs, Pará (7.0%), Mato Grosso (4.6%), Paraná (3.7%) and Ceará (3.5%) recorded the most significant rates. Bernardo Almeida points out that “the industry in Pará is not very diversified, but concentrates in the mining and quarrying sector, which is precisely what drove the growth of the state's industry in October. This good performance comes after three months of negative results, a period in which there was a loss of 7.5%”.

Industry grows in 16 of 18 places compared to 2023

The industrial sector grew by 5.8% compared to October last year and, regionally, 16 of the 18 places surveyed followed the positive result. It is worth highlighting that October 2024 (23 days) had two more business days than the same month of the previous year (21). The greatest advances were recorded in Rio Grande do Norte (25.0%), Pará (12.5%), Santa Catarina (12.2%), Mato Grosso (12.0%) and Paraná (11.3%). Ceará (8.5%) and Mato Grosso do Sul (7.2%) also recorded more intense positive rates than the national average (5.8%). São Paulo (5.8%), Minas Gerais (5.4%), Maranhão (5.0%), Amazonas (4.3%), Northeast Region (4.0%), Rio Grande do Sul (2.7%), Espírito Santo (1.7%), Bahia (1.7%) and Goiás (1.5%) were the other locations with an increase in production in October 2024.

“As it had occurred between September and October 2024, a spread of positive results in the interannual indicators happened again, showing a gain in the pace of industrial production, in regional terms, when compared to 2023”, notes Mr. Almeida.

Conversely, Rio de Janeiro (-5.8%) and Pernambuco (-0.7%) were responsible for the declines in October. In Rio de Janeiro, the explanation for this performance came mainly from the activity of mining and quarrying industries (crude petroleum oils).

More about the survey

Since the 1970s, Regional PIM has been producing short-term indicators regarding the behavior of the real output of mining and quarrying and manufacturing industries. It provides monthly indexes for 17 states whose participation is at least 0.5% of the total value of national industrial transformation, and for the Northeast as a whole: Amazonas, Pará, Maranhão, Ceará, Rio Grande do Norte, Pernambuco, Bahia, Minas Gerais, Espírito Santo, Rio de Janeiro, São Paulo, Paraná, Santa Catarina, Rio Grande do Sul, Mato Grosso do Sul, Mato Grosso, Goiás and the Northeast Region.

The survey results can also be consulted on Sidra, the IBGE database. The next release of the Regional PIM, for November, is scheduled for January 14, 2025.