Despite the resilience, packaging sector faces retraction in 2015 and 2016 should close with another indentation

With closed production gross volume in R$ 57.3 billion, the Brazilian packaging industry presented 4.31% indentation in physical production of packaging in 2015 compared to the previous year. The results of Macroeconomic Study of Packing Open/FGV Retrospect of 2015 and 2016, Outlook presented by the Brazilian packaging Association (Abre) in February, still show that the industry operated with an average degree of capacity utilization of 82.5%, generating 216 1000 jobs in 2015, 4.97% value less than the previous year, when operated with 86.3% of its productive capacity.
In the opinion of Solomon Paintings, Economist responsible for the study, the numbers reflect the scenario of a prolonged recession. Large users of packaging, as the industries of food, beverages, tobacco, clothing, footwear, perfumery, pharmaceutical, cleaning products, cement, fertilizers and paints presented in 2015 retraction higher than in 2014. He says that consumption is behind the poor performance.
Household consumption shrank by 5.8% between the fourth quarter of 2014 and 2015 ", third, recalling that the retraction is significantly higher than that recorded in the 2008 crisis, when consumption fell back just in the fourth quarter, marking a reduction of 2%.
According to Luciana Pellegrino, Executive Director of the Open, the study is a reference to the packaging market. It may be noted that the gross value of production has grown, but ends up being affected by inflation, among other industrial costs and, in some cases, the highest gross production value and technology 2015 2 luciana packing packing produced. "By measuring the variation of physical production and understand what was actually produced, our goal is to offer the industry a thermometer and get a North for actions in the industry," comments.
Addressing specifically the corrugated board segment, Gabriella Michelucci, President of the Brazilian Association of corrugated board (ABPO), informs that the sector closed 2015 with 3.3 million tons shipped, volume that represents a pullback of 3% compared to 2014. Despite the setback, she points out that other industries have undergone significant drops, such as the manufacturing industry, which registered retraction of 10% last year.
"The retreat of 3%, therefore, demonstrates the resilience of the corrugated industry," says. Still analyzing the results presented in 2015, Gabriella stresses that the food industry is the basis of the corrugated industry, representing 60% of the total number of threads that use this type of packaging. "Even so, we recorded retraction of 3%, which shows that we''re past the crisis linked to durable goods and gross production value pack gabriellaestamos 2015 2 facing fall also between goods semi-durable and non-durable," says she, interpreting the numbers. The President of the ABPO points falling purchasing power, with the increased unemployment among the reasons for the fall. "In addition, the Brazil lived a vigorous recovery of wages in recent years, above the inflation value. In 2015, however, follow a reduction of such pass-through inflation to wages. Any loss of capacity of nondurable consumer goods is reflected directly in the segment ".
Prospects for 2016 signaling another tough year
For 2016, reports that the base scenario indicates reduction of 2.8% of the physical production of the packaging sector. The volume produced should be lower than that of 2015 until the third quarter, showing a slight rise in the last three months of the year. In the bottom line of the projection is made for this year, the production must match the R$ 60.5 billion.
The projection is justified by a scenario that assumes an increase in the unemployment rate of 8.6% to 11.3%; loss of purchasing power of the employment income of 3%; new retraction of household consumption, of 2.5%, and 3% GDP contraction. The economist explains that the projected fall in GDP will result in retraction of the manufacturing industry, which will correspond to 4.5%, against 8.3%, seen in 2015, and the services of 2.2%, compared to 2.5% in 2015, as the Focus newsletter.
The industry confidence index, measured by the study also reveals positive evolution of business expectations on the gradual reduction of stockpiles. Frames clarifies, however, that the necessary correction is more related to the reduction of production than the strengthening of demand. In practice, the inventory replenishment that will boost the production should not be immediate or vigorous.
gross production value pack quadrosAdicionalmente, 2015 2 high idle, firms must postpone investments, which means a pillar less to support the possible resumption. "Given the uncertainties associated with the macroeconomic context, it is likely that the projections mentioned need go through revisions over the course of the year," said Qazi.
"Because it is a prolonged recession, the recovery is subject to advances and setbacks. In this context, we can see the first 2017 postponed to positive rates of growth in production, we anticipated for the fourth quarter of 2016 ", ponders the FGV Economist.
On the other hand, the exchange rate around r $ 4 promises to return part of the exports lost competitiveness and encourage the replacement of imports. The reactivation of the economy program by offering credit lines also stands out among the stimuli that can result in less negative than the rates recorded in 2016. Anyway, points out that it will be the largest string of consecutive falls in production, with a total of three years.
In the face of these perspectives, Luciana stresses that the packaging industry has been seeking operational efficiency and cost reduction, in addition to working on the development of new features and exploitation of market niches that bring greater value to the consumer.
The strategy is in line with the work headed by the ABPO as details Gabriella. "In the last two years, we are developing more intense training from the point of view of productivity improvements and cost reduction, encouraging companies to bring their coaches in the Association, so that we can get the national synergy based on what is already being done on an individual basis. The 2016 agenda, already formulated, has focus on this fundamental question: to continue the productive development and reduce costs for the continuous improvement of the companies in the sector. "