According to the Brazilian Foundry Association (ABIFA), the foundry industry started the year with growth in production and domestic consumption.
While December 2020 closed with a total of 165,643 metric tons, castings production ended January 2021 at 183,069 metric tons. Cast iron took first place with 145,907 t produced, followed by steel and non-ferrous metals.
Compared to the same period in 2020, the foundry sector posted a significant 9.5% increase. But has this progress remained positive over the past seven months?
In today's post we will take a look at how the foundry sector has performed in 2021 and what the outlook is for the years ahead. We will also explain why investing in technology for innovation is the best strategy for the industry to prepare to meet demand.
Happy reading!
Foundry sector in 2021: a month-by-month overview
Total castings production closed January with a sum of 183,069 metric tons. That represents a 10.52% increase compared to December 2020.
The foundry sector performance report prepared by ABIFA shows that February was another positive month for the industry. The overall total closed at 195,049 metric tons, with iron and steel predominating.
March showed even more significant growth than the previous two months, totaling 217,277 metric tons. That represents an 11.39% increase compared to February.
Although April recorded a drop in production, the truth is that the month still held an 18.68% increase over the beginning of the year. According to the bulletin, production in April totaled 211,977 metric tons.
In May, castings production recovered from April's drop and returned to record levels. An overall total of 218,470 metric tons was recorded, still with iron and steel predominating.
June was also a month of strong gains, recording 219,914 metric tons produced. Since the beginning of the year, growth has already reached 19.33%.
July maintained record levels in castings production, closing the month at 222,120 metric tons. That is an increase of 1.67% over May, and 21.33% compared to January.
Also according to the report, exports of iron, steel and non-ferrous metals dipped slightly in the first half compared to 2020. Last year Brazil exported a total of 32,047 metric tons, while July 2021 recorded a sum of 24,790 metric tons.
Even with the 22.64% drop in exports, the scenario is promising for the industry. After all, the world economy is recovering from the impacts of the coronavirus, and demand is expected to grow again as this recovery unfolds.
The August performance bulletin is not yet available on the ABIFA website. However, the numbers above are enough to show that the foundry sector is growing, and even more impressive totals can be expected in the coming months.
Outlook for the future of the foundry sector
With the crisis in the automotive industry, caused by lack of demand and labor shortages, part of the sector's production chain was dismantled. The expectation is that, with the economic recovery and the advance of vaccination, the main consumer segment for cast parts will also recover, generating a positive impact on castings production.
For Dan Ioschpe, president of Sindipeças (Brazil's National Association of the Automotive Component Industry), the second quarter of 2020 was challenging. But 2021 and 2022 promise a return to levels close to those recorded in the pre-pandemic period.
The communications and technology segments, along with other sectors that depend on metals as raw material, are also recovering, helping product demand and castings production to continue.
According to IBGE, the Brazilian Institute of Geography and Statistics, the services sector accumulated 9.5% growth for the half-year compared with the first six months of 2020.
The technology sector, in turn, recorded 22.9% growth in 2020, according to research conducted by the Brazilian Association of Software Companies (Abes) based on IDC data.
Technology for innovation: how can the industry prepare to meet demand?
We have only just entered the second half of 2021, but the numbers do not lie, and they show that the outlook is positive for several segments — including the foundry industry.
The question now is to figure out how companies in this niche can prepare to meet demand and get ahead in a competitive market.
On this subject, we can say that the answer is simpler than you might imagine. Investing in technology for innovation remains the fastest and most effective way for the industry to evolve and keep up with all the changes of the modern world.
When you invest in technology for innovation — for example, business management software — companies gain access to features that make their business highly competitive.
To get an idea of just how important technology is: in the case of the foundry industry, managers can map task execution, manage production and inventory, and control financial operations. Not only that, they can also issue electronic invoices, set product pricing, place purchase orders, and handle a range of other tasks.
In other words, they can integrate several departments into a single system and automate processes that until then were bureaucratic. This undoubtedly makes management more practical and helps make production faster and error-free.
Interesting, isn't it?
If you don't yet know a technology for innovation that meets all the requirements above, don't worry. We invite you to learn more about Useall's solutions and discover, in practice, how these tools can help your foundry business.
Originally published in Portuguese at useall.com.br.