Non-oil shipments grew 9% until August, but the logistics crisis worries the export sector

Non-oil non-mining exports experienced a year-on-year growth of 9% from January to last August. However, the logistics crisis that impacts the cost structure worries the export sector. In exported value, this item reached $ 10,062 million and represented 60% of total exports, according to the Ecuadorian Federation of Exporters (Fedexpor), based on figures from the Central Bank.

However, one of the star products, bananas, registered a decrease of -10% in these first eight months. Shrimp, on the contrary, experienced an increase of 27% compared to the same period in 2020.

In the non-traditional area, the canned fish item shows a growth of 10%, while wood and its products decreased by -26% during the same period of analysis.

With $ 2,222 million and 13% growth, shrimp leads non-oil exports in the first half of the year

Meanwhile, regarding destinations, the United States continues to be the first for Ecuador’s non-oil supply. Between January and August 2021, non-oil exports to the North American country grew by 17%. The European Union, as the second commercial destination, registered an increase of 14% in the same period. Unlike the two main destinations, non-oil shipments to China decreased by -4%.

Regarding non-oil imports, they increased by 32%, mainly due to a 43% growth in the import of raw materials, and consumer goods by 28%.

As a consequence, the non-oil trade balance registered an unfavorable result of $ 1,119 million. However, in 2021 the total trade balance shows a surplus of $ 1,814 million, since in the oil sector there is a surplus of $ 2,933 million.

While, Felipe Ribadeneira, president of Fedexpor, acknowledged that the sector faces one of the most complex moments in terms of competitiveness. “In recent months, the cost structure has been seriously affected as a result of various factors internally and externally,” said Ribadeneira.

He added that the global logistics crisis, which is causing significant increases in the cost of transporting goods on a global scale, is impacting the stability of the logistics chains of maritime routes, containers and large-volume reception ports, which, as a result of the pandemic, present interruptions that extend loading and unloading times.

Exporters ask the Government to eliminate the ISD of logistics costs and to comply with the ‘drawback’

“This has caused that, for the Ecuadorian export sector, production inputs and machinery reflect a significant increase that is transferred directly to the costs of exporting companies,” lamented the president of Fedexpor, who pointed out that raw materials such as cardboard, paper , packaging, fertilizers and various intermediate goods that serve to technify production have substantial price increases and, even, the timely supply is risked due to the intermittence of logistics routes that arrive in Ecuador.

For Ribadeneira, the solution depends on a coordinated action of the Government that allows to alleviate the “unnecessary tax surcharge” on the importation of inputs.

“To this are added distorting taxes on commercial activity such as the payment of tax on the outflow of foreign currency that makes international freight more expensive,” said the leader. (I)