Source4less to bring full line of wood products to Middle East
Overwhelming demand for raw goods results in supply botleneck in key Brazilian industries, including the forestry and natural stone sectors
Source4less, the first B2B marketplace dedicated to natural stone and wood products from South America, is set to expand presence in the Middle East with furniture, raw wood and doors. The endeavour comes in part with the rise in residential, home-office and commercial renovations driven by POST-COVID construction.
The United Arab Emirates main forestry imports from Brazil include pinewood, lumber, rough timber and plywood. According to Dubai Exports, a significant portion of the imported wood is utilised at the 600 local factories with over Dhs1 billion capital investment, representing about 13 per cent of the country’s entire industries.
Jan Dabrowa, CEO & Founder of Source4less, said: “These are multi-billion dollar industries that are under-represented in the B2B online sector, with many companies in the Americas lacking the ability to reach out to international clients. Over the past decades, the Brazilian wood and natural stone industries depended mostly on fairs and horizontal commerce to reach global clientele. Source4less is meant to enhance B2B interaction and interconnectedness between suppliers from Latina America and clients worldwide.”
In August 2020 Brazil has exported a record of 212.138 tons of natural stone worth $106.948.183. In April 2020, Brazil exported $885.77 million of wood, paper, and cellulose, according to CEPEA. Many commodities from Brazil and Latin America reach the UAE ports before heading onwards to international destinations.
“Contrary to many expectations, home and interior renovation industry has experienced a significant boom POST-COVID pandemic, especially with people anticipating renovations and remodeling interior living space to suit their home office needs. There is a new trend worldwide that requires agile workspaces. This trend has taken a large part of the furniture industry by surprise, including Brazil which is a key producer of furniture in the Americas,” added Dabrowa.
During 2020, most of the international events and fairs in Latin America have been cancelled due to COVID, including furniture, home decor, stone and wood expos. In response, Source4less is set to lead e-commerce of wood & natural stone products from South America.
“Strong Dollar and weaker Brazilian real is driving local exports, with many international importers turning to Brazil for their sourcing needs. According to current economic and monetary projections, the Brazilian currency shall maintain the course until the end of the year, what might give continuity to high flow of exports. With this in mind, the Middle East continues to be a key trading hub, with a large participation of commodity imports from Brazil and other Latin American countries, either destined to the Region or serving as a transport channel destined to Asia and Africa.”
The Middle East is a focal market for Brazilian exports especially in the commodity sector. In the first seven months of 2020 exports from Brazil surpassed trade of $7 billion, a 16,9 per cent increase in relations to the prior year, according to the Market Intelligence Department of the Arab Brazilian Chamber of Commerce.
It may be mentioned that Brazil’s bilateral trade with the UAE has increased over the last couple of years, particularly with the city/state of Dubai.
In 2018, bilateral trade between Brazil and Dubai accounted for $1.66 billion, with approximately $1.5 billion worth of exports moving from Brazil to Dubai. This trade balance shows how Brazil has successfully established a trade relationship with this Middle Eastern region.
On top of that, 2019 forecasts are set to surpass 2018 numbers. In just the first half of 2019, trade between Dubai and Brazil reached $1.06billion, demonstrating continuous positive trade growth and highlighting a boom of meat exports from Brazil.
In the first half of 2019, Brazilian agribusiness saw an increase of 439.84 per cent in beef exports, with the UAE being one of the main drivers behind this trend. Brazil has reportedly exported 51,000 tonnes of beef to the UAE from January to June 2019.
This impressive amount of exports has been atributed to a variety of factors, such as the “halal practice” – the Islamic form of processing animals or poultry into meat – which is extensively practiced in Brazil, and the Latin American giant’s developing friendly trade relationships with the Arab countries.
Brazil’s trade with Arab countries is therefore increasing. During his recent tour in Asia in October this year, Brazilian President Jair Bolsonaro signed an agreement for cooperation with Saudi Arabia. This deal commits the two countries to mutual cooperation in such as agricultural and industrial sectors, energy, mining, infrastructure, transport and more. Additionally, in November of this year, the Saudi Health Authority (SFDA) authorised eight new Brazilian establishments to export beef into their country.