Brazil's domestic sales of rubber products fell 33% in November compared to the previous month, but full year 2008 results are expected to improve over 2007, national association of rubber products Abiarb president Edgard Solano told BNamericas.
"Revenues are expected to increase around 7-8% in 2008 compared to last year despite the fourth quarter results," Solano said. In 2007, the rubber products industry saw revenues of US$2.18bn, up 10% over 2006, according to the association.
"Sales are already falling in December and the drop is expected to be around 24% compared to November," Solano said.
The financial crisis has weakened demand in the country, particularly in the automotive industry.
"Approximately 67% of the rubber products produced in the country supply the automotive industry," the executive said.
According to Fabio Encinas, German chemical company Lanxess' sales manager, in Brazil the rubber sector was performing excellently before the crisis hit, pushed by the automotive industry and agriculture sector.
"These two segments, in addition to the footwear industry, are the biggest synthetic rubber consumers in the country," Encinas said.
These segments showed some improvement during 2008 but they could have grown more.
"The footwear industry, for example, faces strong competition from China and a lot of manufacturers have just shut down or moved to Asia," Encinas said. "Still, [Lanxess] has seen an improvement in sales for synthetic rubber and additives this year."
According to Encinas, next year will be difficult, as many companies have already announced stoppages or cuts in production.
"We believe in February stocks levels will decrease and industrial activity will speed up again. Growth next year will be lower than in 2008, but results will be positive and there will be no recession," the executive said.
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