Sueli Ortega - Which categories showed the best results in 2009?
João Carlos Basílio - In the Personal Care segment, toothpaste is one of the categories that can be highlighted, because it is a category with a very high penetration rate, an acquired societal habit. The category’s growth rate was about 8,4% in volume in 2009. The expectation of the industry was that this sector product category would generate a growth rate similar to the growth of the Brazilian population - 1,8%, or at maximum 2%. However, in 2009, this category grew 8.4% in volume (17,5% in value), that is to say, far beyond the general economy or population growth, in a category that encompasses all the social classes, it is a sign of a bigger potential for it and for other related categories.
Other top sellers were the soaps, with a growth in volume between 15 and 18%, and with revenues growing by 27%. We have observed that liquid soaps have conquered the bathroom area little by little and it is being incorporated now into the shower box, where the greatest preference in the country is still the bar soap. And vegetal soaps are also penetrating the market.
Actually, everything has its roots in economics. Over the last years, the animal tallow has been used as ingredient for diesel fuel, and as a consequence the price of animal tallow triplicated. So the price difference between animal tallow and vegetal mass, which was 10 times, was reduce to 2 or 3 times.
Thus, the price of prestige soap decreased by 3 to 4 times, which allows a soap production of very good quality, with a differentiated mass and at an accessible price. Society is more and more considering its cost benefit.
Sueli Ortega - Does the fall of exportations led to actions and new programs for the export sector?
João Carlos Basílio - What happened is that Brazilian exports of Personal Care, Perfumery and Cosmetics sector fell by 15.5% in volume in 2009 and 9.3% in value, dropping to US$ 364 millions.
Exports were impacted by the evolution of currency rates - in particular the valuation of the real against the dollar.
However, our analysis is that the performance of our sector can be considered as very good. If you do not consider commodities but only manufactured products, the fall of Brazilian exportations exceeds 25%. In some cases it reaches 40%. Our sector fell by 9.3% in a very difficult context for the export of manufactured goods. It is something like - it is bad, but it is good. It wasn’t a positive result, however in face of the negative picture that crisis was reflected through the exportations of all countries; to us the picture was very good.
Now, the positive side of this issue is that we have today 42 companies involved in an exportation project and are in a covenant with Apex [1], these companies grew by15%. Exports grew by 15%. In other words, companies that are under the Apex umbrella and receive ABIHPEC´s consulting had an excellent performance, they grew by 15%, with a US$ 92 million result.
Sueli Ortega - Were Brazilian exportations for the sector stronger in South America?
João Carlos Basílio - Yes, but the weight of South America is more important for overall Brazilian exports. As far as our sector is concerned the dilution is greater. We sell in 128 countries.
In this region the main buyers are: Argentina, Chile and Venezuela.
Sueli Ortega - How did the perfumery market perform? Brazil was already the second world’s perfumery market in 2008.
João Carlos Basílio - We have ranked as the second market for perfumery products since 2007. We have consolidated these numbers in 2008 and we are getting closer to the first place.
In 2008 Brazil had already a 10.7% market share worldwide. The United States had 16.1%. In 2009 the weight of the US market has probably decreased while Brazil’s contribution should have progressed to 12% or 13%. We anticipate because, as I told you, these data are not consolidated yet, but I can dare to say that we are nowadays the largest fragrance market in the world.
We had a growth of 15.72% (a 16% high in value and 3.5% in volume in 2009). If you consider the inflation in the period, around 4.5%, this means that we have achieved 11 to 12% real growth, which is good, exceptional!
Sueli Ortega - Brazil stands out for its performance in the hair market. What is the market share for this category in 2009?
João Carlos Basílio - If we take the conditioner category, Brazil is already the biggest worldwide market since 2005. This means that 1 out every 5 conditioners sold in the world is sold in Brazil. We are the world’s main consumer of hair conditioners. If we take the category of permanent wave and relaxers, we are also the greatest market worldwide since 2005. If we take the category of permanent and relaxing we are also the largest market since 2005. If we take hair dye, we are already the largest market of the world since 2007, we had 14% market share in 2008. We had in 2009 a 25.345 thousand tons volume in sales. Certainly in 2009 we will surpass the 15% market share in the world.
Sueli Ortega - And regarding the makeup market? Is Brazil walking at large steps?
João Carlos Basílio - It is a very good market, impressive. Here in Brazil the products for nails and lips always predominated. Yet today, face and eyes products are growing too and products for nails have become the smallest market in the makeup category. In the eyes segment, our market grew by 30.74% in volume, and in the face segment it grew by 30.84% in volume. Currently lips are still the largest market in the country, but eyes makeup is already very close, it is growing by 26% in value.
Sueli Ortega - What are the forecasts for growth in 2010?
João Carlos Basílio - Just consider that toothpaste had a growth around 8.4% with the highest rate of penetration, and that all other categories were growing. So I can say that ABIHPEC´s forecast is that in the next 5 years we should continue to have a double-digit growth. Real growth, deflated. The ABIHPEC is celebrating 15 years this year and we are also completing 15th years of growth in the double digits.
