Brazil’s footwear industry is facing a significant downturn as exports plummet and imports continue to rise, leading to a sharp decline in the trade balance.
The latest data from the Brazilian Footwear Industry Association (Abicalçados) reveals a concerning trend—footwear exports fell by 22.4% in volume and 20.4% in value between January and August 2024.
During the same period, imports increased by 12.1% in volume, although their value dropped by 5.1%. The result is a staggering 30% reduction in the sector’s trade balance, a worrying sign for one of the world’s largest footwear producers.
The Brazilian footwear sector has been hit hard by low international demand and increased competition from Asian producers.
According to Haroldo Ferreira, Executive President of Abicalçados, Brazil’s second-largest export market, Argentina, saw a significant decline in its import of Brazilian footwear, contributing to the overall export drop. In August alone, exports to Argentina fell by 30.8%, which played a key role in the broader industry downturn.
Ferreira explained that the global market is undergoing a period of reduced consumption, particularly in major markets like the United States and Europe.
In contrast, Asian countries, especially China, have capitalized on this opportunity, aggressively returning to the global market after the end of their strict COVID-19 policies.
While Brazilian exports have decreased, imports have increased, especially from Asian countries. China, Vietnam, and Indonesia continue to dominate the list of top footwear exporters to Brazil, accounting for approximately 90% of imports.
Notably, footwear imports from Cambodia and Myanmar have seen massive growth. Imports from Cambodia rose by 82.1% in volume and 62.6% in value, while Myanmar recorded an astonishing increase of 168.7% in volume and 156% in value.
These figures underscore a growing reliance on low-cost production in Asian countries, particularly in the face of declining domestic production and export performance in Brazil. Asian manufacturers have stepped in to fill the gap, making Brazil more dependent on foreign footwear, especially low-priced shoes.
The United States remains the top buyer of Brazilian footwear, purchasing 6.95 million pairs worth 147.62 million US dollars from January to August 2024.
However, this represents a 5.3% drop in volume and an 8.3% drop in value compared to the same period in 2023. The second-largest market, Argentina, witnessed even steeper declines, with exports falling by 36.7% in volume and 23.4% in value.
Other key markets such as Paraguay also saw declines, purchasing 5.47 million pairs of footwear worth 28.2 million US dollars, representing a drop of 19.2% in volume and 12.8% in value.
These figures indicate that both regional and global markets are struggling to maintain demand for Brazilian footwear, which has traditionally been a major player in the global market.
Brazil has long been recognized as a global powerhouse in the footwear industry, boasting one of the largest production capacities in the world. According to the World Footwear 2024 Yearbook, Brazil’s domestic market is predominantly served by local production, although this dynamic is increasingly threatened by rising imports.
In 2023, Brazilian footwear exports had already seen a steep decline, largely driven by reduced consumption in key markets such as the U.S. Now, in 2024, that trend has continued, raising concerns about the future of Brazil’s footwear industry.
