Read this Monday’s edition of the FolhaMercado newsletter (25) – 09/25/2023 – Market

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Heat costs

The heat wave that made São Paulo record the hottest day of the year yesterday (24) and is expected to continue in much of the country today (25) is also reflected in the economy.

The impacts of heat:

↳ In energy consumption: In the second week of the month, the SIN (national interconnected system) load reached an average of 73.5 thousand MW (megawatts), a record for the month of September.

• Last Thursday (21), maximum demand reached a peak of 90.9 thousand MW, the highest since February 14th.

• There is, however, no reason to worry about rationing or anything like that. The hydroelectric reservoirs are full and will be able to meet the increased demand.

↳ In retail: the air conditioning industry is already planning to close the year with an increase of up to 10% in sales, after a 2022 with a drop in production.

• In online shopping, the Shopee platform registered an increase in 400% in the volume of searches and advancement of 200% in ventilator sales.

• At Magazine Luiza, air conditioning sales increased 72%.

Other sectors, however, fear a longer-lasting impact of global warming on their production. This is the case with beer, precisely one of the drinks that is most consumed on sunny days.

Atsushi Katsuki, CEO of Japanese brewer Asahi, which owns premium AB InBev brands in Europe and Australia, says warmer temperatures are affecting the supply of barley and hops around the world.

In the small German town of Spalt, famous for its hop plants, growers report that they used to have a dry year and a bad harvest every decade, but this year was the second in a row.

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Ship with ‘wings’ arrives in Brazil

The Pyxis Ocean ship arrived at the port of Paranaguá (PR), a 229 meter long bulk carrier that left Singapore in August and is known for having two “wings” to help save fuel.

Understand: WindWings are a bet by the maritime industry to save time while it continues to search for a less polluting fuel.

• They serve as an alternative to the engine to “push” the ship, which generates fuel savings of up to 1.5 tons per day – but only when there is wind.

• Weighing 200 tons each, they take around 20 minutes to be erected and reach 37.5 meters in height.

Why it matters: Cargo ships are among the biggest polluters, due to the slowness, long distances and time required for travel.

The shipping industry produces 837 million tons of CO2 per year and agreed in July to a plan to bring emissions to zero by 2050.

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The ‘worst investment’ that made the family double their fortune

Virtually no market analyst understood the strategy of the Luksic family, the richest in South America, when they made an investment in the Chilean shipping company CSAV (Compania Sud Americana de Vapores SA) in 2011.

Last year, however, the company was responsible for the majority of revenue and dividends received by the family holding company, which has a fortune of around US$25 billion.

Understand: the Luksic family’s sequence of investments in CSAV included a contribution of more than half in an issue of shares of R$ 1.2 billion that the company did in 2012 to get back on its feet.

At the time, the situation was so complicated that executives had to negotiate exemptions with banks and bondholders to separate their fleet of tugboats.

The tide began to turn in 2014, when CSAV reached a merger agreement with Germany’s Hapag-Lloyd, taking a 30% stake in the world’s fifth-largest shipping carrier.

The boom period came right at the beginning of the pandemic, when online shopping soared, demand for maritime transport exploded and logistics chains became chaos due to the travel restrictions caused by the health crisis.

This combo made the price of everything involving maritime transport rise, from containers to freight.

The Luksic family: Founded in 1957 by patriarch Andronico Luksic Abaroa, the family company was a manufacturer of wooden supports for underground tunnels.

Since then, it has diversified its business across sectors, with its main asset being control of the copper mining company Antofagasta, with a stake worth US$12 billion.

It also controls Banco de Chile alongside Citigroup and has a partnership with Heineken NV for its beer, wine and beverage manufacturing businesses in Latin America.

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Startup of the Week: Mission Brasil

On Mondays, the panel features an x-ray of a startup that recently announced funding.

The startup: Founded in 2017, in Florianópolis (SC), it connects companies to professionals for on-demand work.

In numbers: Mission Brasil announced last week that it had received a contribution from R$ 6.8 million. Throughout its history, the startup has already captured R$10.5 million.

Who invested: two heavyweights in the market, the Domo and Headline XP funds, which have the brokerage as a partner.

What problem does it solve: the startup acts as a middle ground between companies and professionals in the on-demand service, a segment in which contracts are made for specific projects, without permanent ties.

• Examples of services contracted in this modality include market research, mystery shopping, logistics and software for field force management.

• With the investment, Mission talks about the potential of jumping from the current 440 thousand users to 2 million in one year, in addition to achieving revenue of R$ 18 million.

• The startup cites an estimated potential of R$57 billion for the on-demand work sector.

Why is it highlighted?: the type of service intermediated by Mission was driven by the remote work model that came along with the pandemic.

• In addition to companies becoming more accustomed to working away from offices, professionals have opted for greater flexibility, without necessarily being linked to a single boss.

• Last year, the São Paulo Court ordered a microwork company to formalize the hiring of all its service providers.