We have reached the last week of the year, and today on the Modal blog, we will show a retrospective with a top 5 of the main topics we showed during 2022.

What impact does the war between Ukraine x Russia have on Brazil?

Understanding war

It all started in the Cold War, a conflict between the United States and the Soviet Union that lasted from 1947 to 1989, where there was no armed confrontation, but rather a fight for world power (political, economic, cultural, etc.).

As it was a war between capitalists and socialists, the United States created a military bloc in 1949 called NATO to support the capitalist countries of Europe.

And only in 1991 did the Soviet Union come to an end and several republics began to become independent, such as: Belarus, Ukraine, Estonia, Lithuania, Latvia, Moldova, Georgia, Armenia and Azerbaijan.

After the end of the Soviet Union, in the early 2000s, the United States saw an opportunity to expand its NATO allies in Eastern Europe, where Ukraine would be interested in joining the military bloc. The president of Russia, Vladmir Putin, always wanted his country to be giant and one of the main world powers, but he began to see this expansion of NATO as a geopolitical threat to his country, especially in the interest of Ukraine, as they are countries close to each other. .

In addition to this issue, there are the regions of Crimea, Donetsk and Lugansk, which are pro-Russian Ukrainian cities, where Crimea gained its independence and annexed itself to Russia, and Donetsk and Lugansk are in the process of independence, and which facilitated the advance of more than 150 thousand Russian soldiers.

The war still continues, but the rounds of ceasefire negotiations have advanced and the world is hoping that everything will end as quickly as possible and that the population will stop suffering.

How does it affect Brazil’s economy?

Even though the war is on the other side of the world, the economic consequences in Brazil are devastating.

Ukrainian ports are closed to commercial ships docking. Likewise, some shipowners and airlines announced the interruption of operations.

Russia, which produces 11% of the world’s oil and costs around US$130 per barrel, which greatly affects ordinary citizens, paying up to R$11 per liter for fuel in some regions of the country.

In relation to food, two products widely produced and exported by Ukraine and Russia, corn and wheat tend to increase in value on the international market. Even meat can undergo changes, due to the increase in corn, which makes animal feed more expensive.

In agricultural production, Brazil has Russia as its main supplier of fertilizers, which will consequently increase the value of the food that goes to each citizen’s table.

Unfortunately, the longer the war and its sanctions last, the greater the economic effects will be in Brazil and the world.

Modal Comex is now part of the WCA World Group

With more than 10,000 member offices in 196 countries, WCA World is the largest and most powerful network of independent freight forwarders.

WCA World employs a full-time team of more than 100 people in ten member service and support offices around the world. Support includes customer service, information technology, marketing, design, accounting and legal advice, 24 hours a day, seven days a week, 365 days a year.

Founded in 1998 by President David Yokeum as the world’s first non-exclusive global network, it is managed and operated neutrally to truly benefit all member companies.

WCA World continually strives to add new, innovative and valuable membership benefits, which has enabled WCA World to continue setting new standards in the industry.

Each member of the network is automatically covered by extensive financial protection that allows each company to conduct business with other members of the group with complete security and peace of mind.

Commercial relationship between Brazil and the United States

History

The relationship between Brazil and the United States includes a series of diplomatic, economic, historical and cultural relations established between the two. They are one of the oldest nations on the American continent, and the United States was the first to recognize Brazil’s independence. Currently, the United States is Brazil’s second largest trading partner.

Furthermore, both countries are members of many international organizations, such as the United Nations, the World Trade Organization, the Organization of American States, the G8+5 and the G20. Brazil is one of the most pro-American countries in the world. According to a global survey, 62% of Brazilians had a favorable view of the US in 2010, a number that rose to 73% in 2013. However, these surveys were carried out before NASA revealed espionage to the Brazilian public.

In another survey carried out at the end of 2013, 61% of

Americans viewed Brazil favorably.

Commercial Relationship

As the world’s largest economy, the United States is the largest country in the world, which also makes the United States the largest exporter of goods. The country’s biggest export is oil, along with food, beverages and consumer goods such as cars, and capital such as machinery and equipment.

In Brazil, the biggest exports to the USA are fuel oil, products from transition industries, coal and much more. To understand exactly what the commercial relationship between Brazil and the United States is like, it is important to understand that both sides win, that is, they export to our country, but they also import, contributing to our trade balance.

While Brazil imports fuel oil from the US, it also exports large quantities of crude oil. In addition, semi-manufactured steel products, aircraft, gasoline and other manufactured products are also among them.

Trade balance
The economic balance has changed a lot over the years due to good trade relations between Brazil and the United States. For example, in 2019, until August, it showed that the US had raised US$352 million for Brazil, but over time it ended up in the red.

In 2018, Brazil imported more than the United States, leaving the United States with a trade surplus of US$839 million, while the land in Santa Cruz had a deficit.

In 2017, Brazil had a positive balance and, in 2016 and 2015, it was a North American country.

It is clear that the trade relationship between Brazil and the United States is good, but not all products can be traded between them.

Products prohibited for export to the United States
Despite the good trade relations between Brazil and the United States, there are many products that cannot be imported, not only in our country, but also in any other country. Some of them come from marine mammals, shrimp, tuna, but others are also narcotics, products that may infringe intellectual property rights and goods related to terrorist groups and slave labor.

Port of Santos breaks record for year-to-date movement

Container handling at the Port of Santos in August reached 456.5 thousand TEU (unit equivalent to a 20-foot container) and exceeded the result for the same month last year by 12%. Also in the year to date, the numbers were impressive, reaching 3.3 million TEU, 2.9% above the first eight months of 2021 and the best mark for the period.

The performance of containers and agribusiness cargo boosted the Port’s overall numbers, leading it to record a new record for the year, with 110.1 million tons, an increase of 9.0% over the same period of the year. previous.

The growth seen in August was surprising, totaling 14.6 million tons, an increase of 21.4% over August 2021, resulting in the best performance for the month.

In the year, shipments totaled 80.3 million tons, an increase of 11.1% compared to the same period in 2021. Unloadings reached 29.8 million tons, an increase of 3.6%.

In August, shipments totaled 10.6 million tons, growth of 31.0% over that month in 2021. Unloadings reached 4.0 million tons, 1.6% more than recorded in August of the year past.

The highlights among agribusiness cargoes in August were soybeans, with 782.7 thousand tons (+328.75%); corn, with 2.3 million tons (+25.2%); sugar, with 2.5 million tons (+24.1%); bulk bran, with 831.2 thousand tons (+63.5%); and cellulose, with 810.3 thousand tons (+68.7%).

In the year to date, pulp shipments stood out, with a significant movement of 5.4 million tons, an increase of 61.2%; corn, with 6.4 million tons (+78.0%); soybeans, with 23.8 million tons (+9.9%); bulk soybean meal, with 6.2 million tons (+32.0%); and meat, with 1.5 million tons (+31.8%). Among the discharges, fertilizer stood out, with 5.5 million tons (+13.1%).

The flow of ships in the first eight months of the year reached 3,454 vessels, 6.2% above that recorded in this period last year.

Liquid bulk – Presented growth of 5.1% in the month, reaching 1.6 million tons, reflecting the increase in alcohol shipments (39.2%); fuel oil (24.1%); and caustic soda (24.3%). Year-to-date, the category reached 12.6 million tons, an increase of 3.7%, the best mark for the period.

Solid bulk – Totaled 7.4 million tons in August, growth of 34.6%. Corn, sugar, soybeans, soybean meal, cellulose and fertilizers were the highlights. In the year to August, the segment totaled 56.8 million tons, an increase of 12.6%, the best mark for the period.

Commercial Current – ​​Santos’ accumulated participation in the Brazilian commercial current in August was 28.9%. Of the commercial transactions with abroad that passed through Por

of Santos, 30.9% had China as a partner country. São Paulo remains the State with the highest share of commercial transactions with abroad through Porto (53.4%).

Foreign Trade and the 2022 World Cup

How does the World Cup impact the global economy?

The relationship between Foreign Trade and the World Cup can be observed even before the event takes place.

This is because the host country needs to make a series of investments to host the event. In the case of Qatar, more than US$220 billion was spent on the World Cup.

This means massive job creation, as well as an increase in the country’s imports to support all projects.

All this so that the event increases the national economy. To give you an idea, the 2018 World Cup contributed around 12.5 billion euros to Russia’s economy — something close to 1% of its GDP.

In Qatar’s economy, Foreign Trade and the World Cup are expected to generate around US$17 billion in the Arab country’s economy, which expects more than 1 million visitors during the games.

In Brazil, the event will also bring growth to retail. According to the National Confederation of Commerce in Goods, Services and Tourism (CNC), it is estimated that the commerce and services sector generates R$1.48 billion in the economy directly related to the event.

Brazil x Qatar

Qatar has Doha as its capital and also the most populous city, Arabic is the official language and the country became independent from the United Kingdom in a relatively recent period, 1971.

Despite its low representation in our trade balance, Brazil has some commercial relations with Qatar. Last year, we exported around US$285 million to the country and imported US$789.3 million. In 2022 so far, there has been an increase of 57.8% in exports and more than 110% in imports.

Fertilizers, chemical fertilizers and petroleum fuel oils are responsible for practically 95% of everything Brazil imports from Qatar, meanwhile, in Brazilian exports destined for the Arab country, the main highlights are poultry meat, iron ore, engines and machines, pipes and fresh beef.

Import of sporting goods

Last year, through a measure that will be valid until the end of 2024, the Sports Committee of the Chamber of Deputies approved the exemption from the Import Tax (II) and the Tax on Industrialized Products (IPI) on sporting goods as long as are intended for competitions and training of athletes and national teams, thus stimulating our sport.

The majority of sports equipment imported by Brazil comes from China, our main commercial partner, and the United States, which stands out with the main brands in the sector, preferred by most professionals.

However, when importing sporting goods, do good research, look for trustworthy suppliers, demand quality products and use tax benefits to reduce your costs.

2023 is coming and we will have much more content for you!

Happy Holidays!