The United States is now the third-largest exporter of plastics processing machines to Brazil, behind Germany and Italy, according to a report from the American Consulate in SÃo Paulo. U.S.-made machines have captured 16 percent of the import market, the report said. Germany holds 25 percent of the import market, followed closely by Italy with 23 percent.
France is now fourth, with about 10 percent.
The Europeans' strength comes from long-standing cultural and immigration ties, government financing and the large number of German and Italian subsidiaries in Brazil, the report said. As an example, Italian machines are more expensive, but come with attractive financing terms.
However, U.S. machines are becoming more popular, according to the consulate report. In 1994, the United States shipped $25.8 million worth of plastics processing equipment to Brazil, surpassing France for the first time to move into third place.
Exports to Brazil jumped in 1995 to $42 million, a 63 percent gain.
In 1996, the report said, Brazilian processors bought $46 million worth of U.S.-made plastics machinery.
The number should reach $52 million in 1997.
When figures are adjusted for inflation, Brazilian imports of U.S. equipment are growing 8 percent a year. The overall import market is growing at 7 percent.
All values are calculated in U.S. dollars.
The report gives these figures for the total Brazilian plastics machinery market: $700 million in 1995, $752 million in 1996 and $823 million in 1997.
As the largest industrial country in Latin America, Brazil has about 5,000 plastics processing companies, with a total installed base of 45,000 machines.
Those numbers come from DNMAIP, the national department of machines and accessories for the plastics industry in Brazil. DNMAIP says there are about 1,300-1,400 injection presses, 300 blow molders and 400 extruders sold each year in Brazil.
Brazil is by far the largest plastics machinery producer in South America, and sells its equipment to processors in Brazil and throughout Latin America.
According to the American Consulate's report, the main technological differences between Brazilian machines and imported ones are the electrical systems, peripheral automation systems and product finishing equipment.
Imported machines usually target specific niches where Brazilian demand is not high enough to justify local production, such as some types of blow molding machines.
The report also details Brazil's tariff-based import system. Tariffs are scheduled to drop 1 percent every year until 2001, when they will be 14 percent. Machines with no domestic production can be imported duty-free.
The consulate's report does not address the Brazilian government's move, effective April 1, to slow imports by requiring quicker payment terms for imported products. The report came out in March, before the government policy.