Mexico - Brazil Trade 2023 Q4: Volatile Deficit Trends

Key Market Takeaways: Mexico - Brazil Trade

The bilateral trade relationship between Mexico and Brazil is marked by volatility and a persistent deficit in Q4 2023.

• Economic Pulse: Mexico ran a $1.82B trade deficit with Brazil, driven by $2.95B in imports (down YoY) versus $1.13B in exports (mixed growth).
• Exchange Structure: Mexico - Brazil trade statistics reveal intra-industry trade, with vehicles (39% of exports) and opaque HS 99 goods (54% of imports) dominating. Bilateral trade data shows reciprocal but lopsided supply chain ties.
• Strategic Interdependence: The relationship leans on integrated automotive and industrial sectors, though Mexico’s export growth struggles to counterbalance import reliance.

This bilateral trade snapshot is based on verified customs data from the yTrade database.

Mexico-Brazil Trade Trend in Q4 2023

Mexico Export Performance: Shipments to Brazil

• Total Volume: $1.13B in Q4 2023.
• Growth Trend & Context:
  • YoY growth was mixed, with October up 14.77% but December down sharply (-17.61%).
  • No specific trade news to explain the volatility.
• Key Volatility: November saw the steepest MoM drop (-28.5%), followed by another decline in December (-15.02%).

Mexico Import Performance: Sourcing from Brazil

• Total Volume: $2.95B in Q4 2023.
• Growth Trend & Context:
  • YoY trends were weak, with November (-11.58%) and December (-2.91%) both contracting.
• Key Volatility: November recorded the lowest monthly value ($914.71M) and the sharpest MoM decline (-15.02%).

Mexico - Brazil Trade Balance & Market Dynamics

• Net Position: Mexico ran a trade deficit of $1.82B (Imports exceeded exports).
• Relationship Status: Heavy reliance on Brazilian imports, with exports failing to offset the imbalance.

Mexico Import Trend from Brazil 2023 Q4 (Source: yTrade)**

Mexico Export Trend to Brazil 2023 Q4 (Source: yTrade)**

Get Historical Mexico Brazil Trade Records

Mexico-Brazil Top Trading Products in Q4 2023

Mexico Export Profile: What Does Mexico Sell to Brazil

• Top Commodity: Vehicles (HS 87) dominate exports, accounting for 39.26% of total value.
• Demand Driver: Brazil's consumer market absorbs Mexican vehicles, indicating strong demand for transportation goods.
• Concentration: Trade is moderately concentrated, with HS 87 and HS 99 (34.36%) collectively representing 73.62% of exports.

Mexico Import Profile: What Does Mexico Buy from Brazil

• Top Commodity: Unspecified goods (HS 99) lead imports at 54.18%, suggesting a significant but opaque trade category.
• Dependency Nature: High reliance on HS 99 implies potential strategic or niche inputs, though specifics are unclear. Agricultural products (HS 02) at 6.29% hint at supplementary food security needs.

Mexico - Brazil Trade Relationship Dynamics

• The Exchange Model: Intra-Industry Trade is evident, with both countries exchanging similar categories like vehicles (HS 87) and machinery (HS 84/85). This suggests integrated supply chains, particularly in automotive and industrial sectors.
• Value Chain Position: Mexico holds a slight edge in higher-value exports (e.g., vehicles, machinery), while Brazil’s top import (HS 99) lacks clarity, complicating a direct comparison. Trade is reciprocal but skewed toward Mexican manufacturing output.

Import Analysis by Product: Brazil to Mexico (Source: yTrade)

Export Analysis by Product: Mexico to Brazil (Source: yTrade)

Check Detailed Mexico-Brazil Trade HS Code Breakdown

Future Outlook & Strategic Recommendations

Forecast

The Mexico-Brazil trade relationship is expected to face continued volatility in Q1 2024, with Mexico’s trade deficit likely to persist. The sharp December decline in Mexican exports to Brazil (-17.61% YoY) signals weakening demand, while Brazil’s opaque HS 99 imports suggest unresolved supply chain dependencies. However, the strong intra-industry trade in vehicles (HS 87) and machinery (HS 84/85) provides a foundation for recovery if logistics and pricing stability improve. Traders should prepare for uneven growth, with potential upside if Mexico can diversify exports beyond automotive dominance.

Strategic Moves

• Diversify Export Markets: Mexican exporters must reduce reliance on Brazil’s volatile demand by targeting other Latin American markets for vehicles (HS 87) and machinery (HS 84/85).
• Clarify HS 99 Imports: Importers should pressure Brazilian suppliers for transparency on HS 99 goods to assess strategic risks and negotiate better terms.
• Optimize Automotive Supply Chains: Manufacturers should streamline cross-border logistics for vehicle parts to mitigate MoM shipment fluctuations and reduce lead times.

Frequently Asked Questions

How did Mexico - Brazil trade perform in 2023 Q4?

Mexico's exports to Brazil totaled $1.13B, with mixed YoY growth, while imports from Brazil reached $2.95B, showing weak YoY trends.

What are the top exports from Mexico to Brazil?

Vehicles (HS 87) dominate Mexico's exports to Brazil, accounting for 39.26% of total value, followed by unspecified goods (HS 99) at 34.36%.

What does Mexico import from Brazil?

Mexico primarily imports unspecified goods (HS 99) from Brazil, making up 54.18% of total imports, with agricultural products (HS 02) contributing 6.29%.

What is the trade balance between Mexico and Brazil?

Mexico recorded a trade deficit of $1.82B with Brazil in Q4 2023, as imports significantly exceeded exports.