Latin America stories: weekly summary

SAO PAULO (ICIS)–Here are some of the stories from ICIS Latin America for the week ended on 2 February.

NEWS
Chile’s manufacturing output down 2.3% in December, central bank cuts rates 100 basis points
Chile’s central bank interest rate cut this week by one percentage point to 7.25% may have been a welcome move by manufacturing companies, whose output fell 2.3% in December on the back of poor demand.

Colombia manufacturing output booms in January on improved demand
Manufacturing output in Colombia posted a strong recovery in January on the back of healthy new orders that prompted firms to expand production and employee count, S&P Global said this week.

Mexico’s manufacturing output flirts with contraction in January
Mexico’s manufacturing PMI index slipped back into contraction in January as overall output fell on downward pressure on new orders, business closures, unfavorable weather, and demand weakness, analysts at S&P Global said on Thursday.

Brazil’s manufacturing output jumps in January to year-and-a-half high
Brazilian manufacturing output jumped in January on the back of new orders which fuelled the largest expansion in production volumes since mid-2022, analysts at S&P Global said on Thursday.

Colombia central bank cuts interest rates by quarter-point to 12.75%
Colombia’s Banco de la Republica cut its benchmark interest rate by 25 basis points to 12.75% late on Wednesday. It was the second cut in interest rates since the central bank started to ease monetary policy in December.

Brazil’s central bank cuts rates by 50 basis points to 11.25%
The Banco Central do Brasil (BCB) on 31 January cut the main interest rate benchmark, the Selic, by half a percentage point to 11.25%.

Mexico’s GDP up 3.1% in 2023, nearshoring fuels growth
Mexico’s GDP grew 3.1% in 2023, year on year, confirming a resounding year for manufacturing on the back of nearshoring and services, which has fully recovered from the pandemic, the country’s statistical office Inegi said on Tuesday.

Argentina’s peso devaluation too deep, too early while economy enters ‘profound recession’ – economist
The new Argentinian government’s peso devaluation in December came too early and was too deep, not helping reduce the gap between the official peso rate the unofficial ‘blue dollar’ and probably fueling inflation further, according to the director at Buenos Aires-headquartered Fundacion Capital.

PRICING
LatAm PE domestic prices rise in Brazil, Mexico on higher international prices, margin pressure
Domestic polyethylene (PE) prices rose in Brazil and Mexico due to margin pressure and higher international prices. In other Latin American (LatAm) countries, prices were unchanged.

LatAm PP prices higher in Brazil, Chile and Mexico on higher feedstock costs, margin pressure
Domestic polypropylene (PP) prices increased in Brazil due to margin pressure. Prices in Chile and Mexico rose, pushed mainly by feedstock costs. In other Latin American (LatAm) countries, prices remained flat.

Unigel to raise PS February prices in Brazil
Unigel is seeking a 17% price increase on all grades of polystyrene (PS) sold in Brazil starting on 1 February, according to a customer letter.

Sustained ethanol demand continues due to favorable fuel parity in Brazil
The current fuel parity in Brazil continues to favor ethanol over gasoline, standing at a rate of 67%, as reported by market sources.

Higher PET prices in Colombia and Chile at the end of January
Polyethylene terephthalate (PET) prices in Colombia and Chile are firm based on market input, and demand is relatively stable with good spot availability in both countries. The recent fluctuation in prices is in line with international benchmark market trends this month.