October 7, 2022

The war affects local industries and creates a climate of uncertainty

Effect

The conflict in Ukraine worries businessmen in the region, because of the instability in the value of inputs

Written by Anna Carolina Lill

Mar 24, 2022 at 7:34 am

The war between Russia and Ukraine, which reached its 28th day this Wednesday, has raised doubts and fears among businessmen in the region. at AmericanDirector of Ciesp (Center of Industries in the State of São Paulo), Leandro Zanini, stated that the rise in oil (exceeding the $100 mark for the first time since September 2014) is the biggest concern of the associates.

“Not only has fuels increased, but the entire plastics production chain has increased [peças, embalagens, equipamentos]Noting that these inputs are largely consumed by industries.

According to Zanini, inflationary pressure in the food chain derived from wheat is also a cause for concern. He stressed that “the global downturn can reduce exports and even industries that do not carry out international trade can suffer from a decrease in the number of orders and sales from their customers.”

The price of a barrel of oil from the fears caused by the war – Photography: Darren Zmmit Lobby / Agência Brasil

Ciesp . Manager Santa Barbara de OesteNevaldo Jose da Silva said companies were indirectly affected by the war because their international suppliers lost some components, or increased costs motivated by commodities.

“On the other hand, the dollar has fallen, so this situation has eased a little bit for these industries. However, some reported that on the export issue, they had customers from Russia and they are not sure what will happen, whether they will be allowed to ship the products when they are ready or not.

Industrial sounding survey released this week by Ciesp de Campinas It reveals that 33% of entrepreneurs have already been negatively affected by the conflict, 47% anticipate the effects for the coming months and 20% still do not have an assessment.

For Ciesp Campinas Director, José Henrique Toledo Corrêa, the reactions of the war in the regional industry refer, at that moment, to increases in fuel, international shipping, fertilizer and wheat inputs in the food sector. He declared that “if the conflict continues and takes on other directions that we do not want, this situation may change and have a stronger impact on the industry and other sectors.”

There are indeed some points of concern in imports, said Ciesp Campinas’ director of foreign trade, Anselmo Risso. “We import fertilizers, fertilizers, chemicals, potassium and rubber. In this January-February period, we imported $17.6 million, which is 0.91% of our import volume in the region. We have two municipalities in the region that depend on these imports – Sumaré and Polynia, with fertilizers. Thus, the agricultural sector will be one of the worst affected sectors in the region, due to the import of fertilizer inputs, such as potassium.

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In a statement, Yara Brasil, a fertilizer company located in Sumar, states that it continues to assess the situation and work to mitigate potential impacts on the supply of products as much as possible. The group imports raw materials from other countries, and Russia is one of the main suppliers.