National production decreased 1.12% in January of 2023

In January of this year, national production decreased by 1.12% compared to the same month in 2022, after presenting 22 months of uninterrupted growth. This result was supported by the adverse development of five of the main economic sectors such as Mining and Hydrocarbons, Construction, Transportation, Storage and Courier; Financial and Telecommunications; this was made known by the National Institute of Statistics and Informatics (INEI) through the technical report National Production. It also reported that during February 2022 - January 2023, the national economy increased by 2.35%. 

 

The result of the month under analysis was influenced, among other factors, by social conflicts that led to the stoppage of work, roadblocks, and the obligatory closure of markets, the impediment of free traffic of people and merchandise that happened in some areas of the country.

 

Agricultural production increased by 1.89% due to the positive behavior of the agricultural subsector in 4.93%, by recording higher volumes of oil palm (15.3%), cocoa (11.5%), alfalfa (10.1%), grape (8.6%), mango (7.9%), paddy rice (5.0%) and banana (4.1%) before the weather conditions recorded on the Peruvian coast that presented temperatures above normal. However, the Highlands reported no rain and short summer (short-term dry period of 10 to more days) for an extended period, and rainfall was recorded in the Jungle below normal levels; nevertheless, these factors did not impair the normal growth and fortification of crops in some areas of the country. 

 

On the other hand, the livestock subsector decreased by 2.35% due to the lower production volumes of poultry (-4.4%), wool (-2.3%), sheep (-1.9%) and eggs (-0.7%).

 

In the first month of this year, the Fishing sector grew by 32.96% determined by the greater extraction of species of maritime origin (37.27%). It was reported an increase in indirect human consumption (anchoveta for fish meal and fish oil), registering an extraction of 546,831 tons, compared with 111,127 tons reported in January 2022, it means an increase of 392.08%, result that was recorded in the third month of the Second Fishing Season 2022 in the North-Center Zone of the Peruvian coastline.

 

Nevertheless, the disembarkation of species for direct human consumption (-26.34%), for canning (-44.1%) and freezing (-36.6%) decreased; however, shipments destined for curing preparation (11.1%) and for consumption in a fresh state (3.2%) increased. In addition, fishing of continental origin contracted 0.22% due to the lower extraction of species for freezing and preparation of curing.

 

The Mining and Hydrocarbons sector decreased by 3.61% as a result of the contraction of metal mining activity by 3.63% due to the low production volumes of tin (-62.5%), silver (-19.9%), molybdenum (-12.4%), zinc (-6.9%), gold (-6.8%), lead (-6.7%) and copper (-1.6%); while iron production increased (51.7%). 

 

Likewise, the hydrocarbon subsector was reduced by 3.5%, supported by the lower exploitation of crude oil (-16.7%) and natural gas liquids (-3.3%); however, natural gas production grew (8.2%).

 

In January of this year, according to the Ministry of Production, the Manufacturing sector grew by 1.08% driven by the primary sub-sector (13.56%); however, the production of the non-primary sub-sector decreased (-3.16%). The performance of the primary sub-sector was influenced by the increased production and conservation of fish (57.1%), meat production (6.7%) and the manufacture of precious metal primary products (2.6%); while, the manufacturing branch of petroleum refining products (-5.6%) and sugar production (-2.3%) decreased. 

 

On the other hand, the fall of the non-primary sub-sector was determined by the lower activity of its three components: intermediate goods (-6.65%), consumer goods (-0.30%) and capital goods (-4.12%)

 

The Electricity, Gas and Water sector grew 3.30% due to the effect of the generation of electric power (4.01%); however, the distribution of gas (-0.40%) and water production (-0.95%) decreased. The result of the electricity subsector was the result of the largest generation of thermoelectric energy (18.4%); while, the generation of hydroelectric energy (-3.7%) and unconventional renewable energy (-0.9%) was reduced. Water production decreased, after adding positive results for 17 continuous months, associated with the low production of drinking water of the company Sedalib (-7.5%), Seda Chimbote (-4.7%), Sedapar (-3.0%) and EPS Grau (-0.7%); nevertheless, the production of Epsel (2.6%) and Sedapal (0.6%) was increased, among the main ones. 

 

The reduction in gas distribution, for the second consecutive month, is explained by the lower demand of the Electric Generators (-5.5%); however, the gas distribution to the Companies (27.7%) and to Vehicle Natural Gas sales establishments (24.9%) increased. 

 

In January 2023, the production of the Construction sector decreased by 11.7% as a result of the lower domestic consumption of cement (-15.12%); while the physical progress of public works (24.55%) grew. The result of the domestic consumption of cement is explained by the reduction in private works and self-construction; in addition, it influenced social conflict with the consequent blocking of roads, in certain areas of the country that generated the cancellation of orders and suspension of the working day in some works, as well as in the construction of buildings. 

 

On the other hand, the increase in the physical progress of works was observed in the areas of government: National (100.7%) that was attenuated by the lower investment made in the Local (-56.6%) and Regional (-37.5%) government associated with the change of authorities and the start of new regional and local management. Among the works of the national government that increased, are works to expand sanitation systems and even the recovery of hospitals and medical centers, and schools.

 

Commerce sector increased by 1.24% due to the favorable performance of the wholesale sale (1.35%) of electronic and telecommunications equipment; machinery and equipment; fuel and allied products; household goods for office supplies and school supplies for “School Campaign”, among others. Retailing sale (2.02%) was associated with demand for books and school supplies, clothing due to summer campaign, gas stations and self-services establishments. Nevertheless, the sale and repair of vehicles decreased (-2.16%) due to the low demand for transport vehicle accessories.

 

In January of this year, the Transport, Storage and Courier sector decreased 2.94% as a result of the unfavorable behavior of the Storage and Courier sub-sector (-15.35%), behavior that was attenuated by the progress of the Transportation sub-sector (3.46%). The Storage and Courier subsector was affected by the lower requirement for storage service and transportation support activities (-15.6%), as well as postal and courier activities (-10.3%). The favorable outcome of the transportation sub-sector was based on the development of air transport (24.3%) due to greater passenger movement. Meanwhile, decreased in the other transportation systems where the impact of social conflicts was observed, which negatively affected ground transportation and pipelines (-3.1%) due to lower passenger traffic and cargo through railway (-40.9%) and the reduction of road transport (-3.0%), due to the lower load movement (-8.5%). 

 

It also showed unfavorable behavior in transportation by water route (-10.1%), associated with the lower requirement for transport by sea of goods and waterway, both passengers and cargo.

 

Production of Accommodations and Restaurants sector grew by 7.99% driven by higher restaurant subsector activity (9.3%) while accommodations subsector decreased (-4.3%). The variation recorded of the restaurant sub-sector was supported by the greater influx of customers, mainly families at the start of the holiday season; influenced by the presentation of new menus, summer promotions and discounts, extension of operating hours, commercial alliances and greater coverage of the delivery service.  On the other hand, the Accommodation subsector decreased as a consequence of the reduction in tourism flow caused by social conflicts and road blocking.

 

During the month of the study, the Telecommunications and Other Information Services sector decreased by 9.26%, as a result of the telecommunications subsector (-10.27%) and the other information services subsector (-0.42%). In the telecommunications subsector, data transmission (-20.8%) and telephony (-14.9%) services decreased, both fixed and mobile; however, the internet and subscription television service grew (1.0%). The contraction of the subsector other information services was determined by the reduction of editing activities (-12.9%), TV and radio programming (-5.5%); in contrast, computer programming (1.1%) and production and display activity of movies and TV shows (42.6%) grew.

 

The Financial and Insurance sector contracted by 5.95% as a result of the lower credits (-5.6%) and deposits (-6.5%) of multiple banking. According to the segment, they showed a downward trend for credits aimed at corporations, large, medium, small and micro-businesses (-11.4%), as well as home mortgages (-0.9%); however, consumer credits grew (13.7%). According to economic sectors, credits aimed at the trade sector reported negative variation; real estate, business and rental activities; manufacturing; transportation, storage and communications; and construction. 

 

On the other hand, the reduction of the deposits of the multiple bank was evidenced in the areas of: Savings Deposits (-16.0%), Demand Deposits (-15.9%) and Service Time Compensation Deposits (-14.8%); instead, Fixed-term Deposits (25.4%) increased. 

 

The INEI reported that the Services Provided to Companies sector increased by 0.65% due to the effect of travel agencies and tour operators (9.6%), advertising and market research (3.8%) and professional, scientific and technical activities (0.8%); however, administrative and company support services activities (-0.6%) were reported to decrease. The variation obtained was influenced by the dynamics of domestic tourism and issuing tourism. Likewise, advertising activity was favored by the launch of advertising campaigns by season (summer season and school campaign), summer advertising panel rental. Instead, administrative services and campaign reduction support activities were reduced via call center, debt portfolio, employment agencies and car rentals.

 

During January of this year, Government Services grew by 2.13% as a result of the largest activities carried out by institutions of the National, Regional and Local Government. The Public Administration sector increased by 2.1%, supported by the activities of the Foreign Affairs sector, the Education sector, the Economy and Finance sector, among the main ones. Defense sector increased by 2.1%.