2021 was a troubled year for everyone: new variants of COVID-19, rising interest rates, inflation, water crisis and lack of raw materials.

For the beginning of 2022, no difference is expected. The Central Bank of Brazil, for this year, has already exposed an increase in interest rates to 11.75% p.a. The SELIC will tend to remain high, reducing to 8% p.a. until the end of 2023*.

What is this rise in interest rates due to?
The 2021 increase occurred in an attempt to reduce inflation, with a closing rate of 10.03% (IPCA) in 2021, well above the target set by the Central Bank of 3.75%**. Many economists are against this measure package, as the increase in interest rates tends to slow down the economy due to the increase in credit rates.

The rise in inflation was driven by the great demand added to the lack of raw materials on a global scale. In the fourth quarter of 2020, many countries experienced the so-called "V-economy recovery", suddenly increasing demand for steel, ore, electronic components, etc. As most mines and factories were LockDown or with reduced production (due to the Corona Virus), a general lack of products on the market began, consequently raising the prices.

Automakers and engine manufacturers expect a normalization of production only in the 2nd half of 2022, after a new incentive in the manufacture of semiconductors, the main component responsible for halting production in 2021***.

Increase in demand for Generator Sets
In the specific case of gensets, in addition to the "V-shaped recovery", demand was leveraged by the water crisis in Brazil. Due to the fact that the Brazilian energy matrix is ​​largely hydroelectric, many resorted to buying generators for fear of blackouts and increases in the electricity bill (the generator, used at peak hours, allows savings of up to 30% on the energy bill).

For 2022, demand tends to remain high, driven by investments from large industries postponed in 2020 and 2021 by the pandemic.

As for the level of reservoirs, the scenario is uncertain. Intense rains are not enough, it is necessary that they occur in appropriate places, close to the sources of rivers and dams. The best thing to do is to prepare and invest in reliable sources of energy.

“Last year (2021) we had a lot of problems with the big demand and lack of engines. Delivery times are getting longer, and the outlook is not improving” - explains Márcio Martins, Industrial Director at GERAFORTE.

"2021 was a year with positive and negative sides. On the one hand we grew a lot, increased our production and strengthened our technical assistance and sales team. On the other hand, there was a lack of material for production." - commented Denancir Filipin, Commercial Director of GERAFORTE.

"In order to serve the entire market, we have improved our sales and stock policy. The objective is to maintain quality and reduce delivery times, without this affecting the price of the product. I believe we are doing a good job, no wonder that we grow more than 30% a year" - adds Denancir.

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*www.agenciabrasil.ebc.com.br/economia/noticia
**www.valorinveste.globo.com/mercados/brasil-e-politica
***www.terra.com.br/parceiros

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