Brazil’s industrial output falls more than expected in July

SAO PAULO (Reuters) – Brazil’s industrial production fell more than expected in July, losing steam after a stellar performance in the previous month, government statistics agency IBGE said on Wednesday.

Industrial production in Latin America’s largest economy fell 1.4% in July from June . Economists polled by Reuters projected a decline of 0.9%.

“Negative industry performance in July comes after intense growth in the previous month,” IBGE survey manager Andre Macedo said. In June, output had increased 4.3% from May, revised data from IBGE showed on Wednesday, breaking a two-month negative streak.

According to Macedo, some important industrial plants also halted their production process in July. The main negative influence came from food products, with production down 3.8% on a monthly basis.

“There was a drop in sugar production, impacted by the effects of a drought in the country’s center-south region, as well as in beef and soy products. These items were the ones that contributed most negatively this month,” Macedo said.

Still, industrial production jumped 6.1% in July from a year earlier , IBGE said, citing “spread positive results” and a low 2023 comparison base. Economists polled by Reuters were expecting an annual increase of 6.3%.

With July’s figures, Brazil’s industrial sector is now 1.4% above pre-pandemic levels but 15.5% below its record high reached in 2011.

(Reporting by Luana Maria Benedito; Editing by Mark Porter)