ANALYSIS OF THE DETERMINANTS OF THE MAIN PRODUCTS EXPORTED BY MINAS GERAIS (IRON ORE, COFFEE AND SOY) FROM 2000 TO 2021 BY ARDL MODELS

Abstract

This article investigates the composition of Minas Gerais' trade agenda from 2000 to 2021 in order to highlight reprimarization in exports, and analyzes the short and long term determinants, including the effects of the COVID-19 pandemic, of sales of the main products that make up the state's export basket (iron ore, coffee and soybeans). For this, Autoregressive Distributed Lag (ARDL) models are estimated. The analysis of Minas Gerais' trade agenda highlights the high concentration of exports in the three products considered favored by high international prices and Chinese demand, corroborating the process of state reprimarization. In the short term, econometric evidence points to the dependence of coffee and soybean exports on the favorable performance of international prices, while external demand is relevant to stimulate iron ore exports. However, such effects are not sustainable in the long term, as price and real exchange rate shocks only benefit coffee exports, while external demand contributes to increasing soybean exports. It is worth noting that the pandemic crisis helped to expand Minas Gerais' specialization in iron ore, but did not affect exports of other products.