Brazil Infrastructure Report Q3 2014: New research report available at Fast Market Research

From: Fast Market Research, Inc.
Published: Thu Jul 17 2014

We believe Brazil will struggle to sustain a rebound in construction sector growth over the medium term. Despite maintaining our outlook that growth will pick up between 2014 and 2018 as concessions enter construction and the residential market continues to rebound , we anticipate a longer term slowdown as fundamental weaknesses emerge and financing sources are exhausted.

Despite a four year BRL959bn PAC II investment programme, which according to June 2014 data was 86% executed as of April 2014 when the programme ended, the construction sector has continued to see only weak growth.

However, we believe the USD235bn concessions programme will generate higher growth over the medium term, as construction gets under way on major road and airport projects. Over the coming year, additional port and rail projects will also be tendered. In 2013, BRL80bn in concessions were awarded, followed by BRL12.3bn in the first four months of 2014, and BRL111bn more are expect before the end of the year - although delays are likely given legal hurdles related to port concessions and plans to re-design the rail tenders into smaller packages. As such, we are forecasting growth to average 4% between 2014 and 2017, compared to an average of 2.2% between 2011 and 2013.

Full Report Details at

Residential construction rebound

Despite continued growth in the housing market over 2012, with house prices and mortgage applications reporting strong expansion, the construction of new residential properties stagnated. Housing starts fell by 37% y-o-y in 2012. This trend has reversed in line with expectations during 2013, as homebuilders rebuilt their balance sheets, improving cashflow, and cost pressures eased, allowing them to focus again on subsidised mortgage housing. This end of the market is crucial for homebuilders, considering interest rates have been hiked following a steep easing cycle in 2012 and that the Minha Casa Minha Vida programme has been extended for a third phase in June 2014. In line...

The Brazil Infrastructure Report features Business Monitor International (BMI)'s market assessment and forecasts covering public procurement and spending on all major infrastructure and construction projects, including transportation and logistics by land, sea and air; power plants and utilities, and commercial construction and property development. The report analyses the impact of regulatory changes and the macroeconomic outlook and features competitive intelligence on contractors and suppliers.

BMI's Brazil Infrastructure Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Brazilian infrastructure and construction industry.

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