The economy slowed: industry and construction collapsed in March

In March, industrial production improved 3.6% compared to the same month in 2021, while construction rose 1.9%. But compared to February, and for both cases, the seasonally adjusted series registered a decline: 1.9% in industry and 4.1% in construction. This is indicated by the Indec indices.

“Compared to December 2019, industry activity was 9.5% higher and construction was 25% higher,” according to calculations by LCG consultancy based on figures from the official body of statistics.

In the industry, the manufacture of clothing, leather and footwear led the improvement in production with a year-on-year increase of 27.3% in March and 25.8% in the first quarter of 2022.

“Sources consulted indicate increasing demand from both wholesale and retail customers, in addition to larger national production due to the reopening of several production plants last year and the integration of new production lines. On the other hand, both sources added that the increase in work and school attendance and the larger holding of events, based on lower health restrictions compared to the first quarter of 2021, helps to explain this increase. , “said the Indec report.

On the other hand, “the main negative impact in the month under review was observed in crushing oil seeds, showing a year-on-year decrease of 13.4%. According to data from the Ministry of Agriculture, Livestock and Fisheries , in March production of soybean oil and by-products showed a year-on-year decline of 15.2%, while production of sunflower oil and by-products registered a year-on-year increase of 2% .The exported values ​​of oil and soybean by-products show a year-on-year decrease of 12% for the same comparison ”, explains Indec.

Also in March, cattle production fell by 2.4% year-on-year.

In construction, in March, asphalt improved (26.5%), followed by plasterboard (10.9%), but hollow bricks (9.9%) and paints for construction (4.6%) declined. ).

“The industry is acting quite ambivalently, with consecutive months of growth and contraction,” consultancy LCG said in a report. “The year started with a 6.4% monthly decrease of seasonally adjusted, followed by 5% growth in February and now a 1.9% decrease.”

Something similar happened with construction: after seasonally adjusted monthly growth of 5.9% in February, construction fell by 4.1% in March.

Consulting firm LCG pointed out that “in the case of the industry, we expect a more modest growth in 2022, slightly less than the statistical drag left in 2021 (2.8%), mainly explained by the normalized comparison bases combined in less favorable conditions. international economic conditions. ” And in the case of construction, “even if capital spending at the national level is not a change in the adjustment program agreed with the IMF, lower capital transfers to the provinces could affect activity. However, activity is at a high level. level and is helped by a still high exchange rate gap, which reduces the cost of materials measured in free dollars ”.