Brazil's mining output grows again, but remains dependent on iron ore

The year's mining output resulted in a CFEM revenue (Financial Contribution on Mineral Exploitation) totalling R$ 7.45 billion in 2024, an increase of more than 9 percent from the R$ 6.81 billion reported in 2023. Iron ore was the product that paid the largest share of CFEM in 2024, at R$ 5.57 billion, followed by copper (R$ 406.7 million), gold (R$ 358 million), bauxite (R$ 165.7 million) and limestone (R$ 149.7 million).

The mining industry exported US$ 80.9 billion in 2024, a slight increase from 2023. As a result, the industry's share in total exports increased from 23.2 percent in 2023 to 24.0 percent in 2024. The industry's main export product was iron ore and derivatives, with a total of US$ 29.8 billion, giving an 8.9 percent share in the country's total exports in the year. That was slightly less than in 2023, when sales of iron ore and derivatives abroad totalled US$ 30.6 billion, representing 9.0 percent of exports. In value terms, iron ore exports fell by 2.4 percent, while the average price was 5.2 percent lower than a year earlier.

Even with a 0.8 percent reduction compared with 2023, overall Brazilian exports totaled US$ 337 billion, which is the second highest value in the historical series. In volume terms, on the other hand, exports increased by 3 percent.

Imports grew 9 percent in the year to US$ 262.5 billion, also the second highest annual figure in the historical series. As a result, the trade surplus in 2024 was US$ 74.6 billion, down 24.6 percent in the year. In 2023 the surplus had been US$ 98.9 billion. Imports increased by 17.2 percent in volume terms but by only 9 percent in value terms, as prices fell by an average 7.4 percent.

Largest companies

In 2024 the fifty largest mining companies in Brazil (see table) accounted for an overall output, in value terms, amounting to R$ 212.5 billion. This was 78.5 percent of the total produced in the year by the mining industry as a whole. Vale leads the list by a wide margin, with an output figure of R$ 117 billion, which is 43.2 percent of the aggregate output of the more than 7,000 companies and individuals engaged in mining in Brazil. Vale currently produces iron ore in 32 separate operations located mainly in Minas Gerais and Pará. The second placed company is Vale Base Metals, acting through Salobo Metais, Brazil's largest copper producer, with two operations. The output figure for Salobo Metais was R$ 15.1 billion, or 5.6 percent of the total. Anglo American Minério de Ferro Brasil, which has two operations, appears in third place, with a 2024 output stated as R$ 11.3 billion, giving a 4.2 percent share of the total. Others included among the ten largest producers are CSN Mineração (iron ore), Kinross Brasil (Kinross group – gold), AngloGold Ashanti (gold), Jacobina Mineração (Pan American Silver group – gold), Mosaic Fertilizantes (phosphate and potash), Samarco Mineração (BHP and Vale – iron ore) and Mineração Paragominas (Hydro group – bauxite).

Iron ore products dominate the list of the fifty largest mining companies ranked by their 2024 output. In fact, seventeen of the fifty are iron ore producers, followed by gold (eleven companies), copper (five), and bauxite (three).

Growth prospects

The growth prospects of the Brazilian mining industry in the coming years are positive, not only in markets in which Brazil is already an important and traditional player, such as iron ore and gold, but also in those markets in which the country is only now beginning its journey, such as the strategic minerals for the energy transition (see article in this issue).

From the statistics listed above it clearly emerges that iron ore still remains — and is set to remain for many years to come — the flagship of the Brazilian mining industry in both volume and value terms, although over time this predominance will no doubt be put into perspective, due to the growing output of other minerals such as copper, lithium, rare earths, graphite, nickel, and others.

There are some growth projects in iron ore, mainly in the state of Minas Gerais, but also in the states of Pará, Bahia, and Mato Grosso do Sul.

MAIN MINERALS PRODUCED IN BRAZIL IN 2024

In the state of Bahia, BAMIN, which according to market rumors was being acquired by Vale, announced the expansion of planned investments, which increased from R$ 14 billion to R$ 20 billion, in an integrated mine-railway-port project. The projected capacity is 26 million tons of iron ore per year.

Santa Fé Mineração plans to begin implementing the first stage of production of a high-grade pellet feed plant with a 65 percent iron content, located in southwestern Bahia, for a R$ 2 billion investment.

Brazil Iron also has a project in Bahia for a mining unit and a hot briquetted iron (HBI) facility with a capacity of 5 million tons per year, for a budgeted investment of US$ 5.7 billion. In addition to the mine itself, Brazil Iron plans a pellet feed plant in the Piauí and Abaíra regions and two others in the port region, one for pellets and the other for HBI. In a second stage, a third plant is to be built, to produce green hydrogen. The project is currently at the environmental licensing stage.

In Mato Grosso do Sul, LHG Mining (formerly J&F Mineração) has announced a R$ 5.5 billion investment program to expand its capacity. The company's long-term goal is to reach a capacity of 50 million tons a year.

Gold is a market segment that has recorded significant growth in Brazil and seems set to carry on growing, mainly in the light of medium-scale projects announced by companies such as Hochschild Mining, G Mining, Equinox Gold, Kinross, TriStar Mineração, and Bemisa, among others.

Kinross, Brazil's leading gold producer, is concluding a US$ 30 million investment in a project to boost production at Paracatu, in Minas Gerais, by around 20,000 ounces per year.

GMining Ventures is already producing on a commercial scale at its Tocantinzinho project, in the state of Pará, designed to produce 1.83 million ounces of gold over its 10.5-year useful lifetime. Capex for the project is stated as US$ 481 million.

In May 2024, Hochschild Mining began commercial production at its Mara Rosa project, in the state of Goiás. It is the company's first gold mine in Brazil, in which it has invested R$ 900 million. Planned output is in the range from 83,000 to 93,000 ounces. Also in the company's plans is its Monte do Carmo gold project, in the state of Tocantins, formerly the property of Cerrado Gold. The deposit holds proven reserves of approximately 1 million ounces of gold.

Aura Minerals has been pursuing a strong growth strategy since 2018 and plans to achieve an output of 450,000 ounces of gold in 2025 and beyond. In 2023 the company brought its Almas project on stream, in the state of Tocantins, budgeted at US$ 73 million and scheduled to produce 51,000 ounces of gold per year during the first four years. The company also began implementing its Borborema project, in the state of Rio Grande do Norte, which it acquired from Big River and where it is investing US$ 188 million. Another project in Aura's portfolio of new developments is Matupá, in Mato Grosso. The feasibility study, already completed, indicates that the planned investment for the project is US$ 107 million, for an annual output capacity of 54,700 ounces in the first four years and an expected seven-year useful lifetime, based on reserves estimated in accordance with Canada's National Instrument 43-101.

Equinox Gold intends to put an underground mine into production, by 2028, at its Aurizona mine, located in Godofredo Viana in the state of Maranhão, where it already carries out open pit mining, producing at a scale of 120,000 ounces of gold per year. Implementation of the underground mine is scheduled to begin in mid-2025, for an investment of around R$ 900 million. The company is also planning a new project aiming to extent the Life Of Mine in Fazenda Mine, located in Bahia state. The total investment could reach US$ 199 million, to be disbursed until 2033.

TriStar Gold will begin implementing its Castelo de Sonhos project, located in the municipality of Altamira, in Pará. It will be an open pit mine with a forecast output of 125,000 ounces of gold per year, for a period of ten years. The crushing plant is designed to handle 10,000 tons of ore per day, with an average gold content of 1.12 grams per ton. Gold reserves total 1.4 million ounces, and the projected capex is US$ 261 million.

Bemisa has announced an increased mineral resource of 1.73 million ounces of gold with an average grade of 1.47 g/t for the Água Azul Complex, as detailed in its independent technical report, recently prepared in accordance with National Instrument 43-101.

The project is located at Água Azul do Norte, a small municipality approximately 180 km southwest of Parauapebas, close to the Carajás polymetallic district. The Água Azul Complex consists of four mining rights covering 6,500 hectares (25 square miles), which hosts gold mineralization. Bemisa has invested in geological and metallurgical research over more than six years, with the aim of ensuring the technical, economic, and socio-environmental viability needed to operate. The company notes that the resource estimate considers surveys carried out solely in six of the project's twelve targets, indicating that there is high unexplored geological potential for expanding mineral resources. A reserves report is to be concluded before the end of the first quarter of 2025. One of the project's key strengths is that the Água Azul ore has low sulfidation and is practically free from contaminating metals, particularly environmentally harmful elements like arsenic and lead. These characteristics allow for processing with low cyanide consumption and high metallurgical recovery, in addition to a safe waste disposal operation, with low potential for acid drainage. The pilot plant in operation has the capacity to process 150,000 tons of ore per year. The company has applied for licensing for a production scale of 200,000 tons a year. The processing utilizes a filtration and dry stacking system, eliminating the need for a tailings dam. The open pit mine is operated selectively, targeting ore-rich zones while minimizing barren rock and reducing dilution rates.

Cabral Gold has completed a positive pre-feasibility study for its Cuiú-Cuiú project in Pará, showing that it could yield 19,700 ounces in each of the first two years. The project has a low development capex of US$ 37.4 million.

Belo Sun is resuming the permits procedure for its Volta Grande project, located in the municipality of Senador José Porfírio, in Pará. With an originally forecast capex of US$ 298 million, the project is planned to produce 268,000 ounces a year in the first ten years and a total of 3.53 million ounces over its lifetime. Recently, La Mancha acquired s 17.1 percent equity stake in Belo Sun.

Copper production in Brazil has been gaining in importance year by year, as can be seen from its growing share in overall mining output. Although there are still only five companies producing copper in Brazil — Salobo Metais-VBM, Mineração Maracás-Lundin Mining, Mineração Caraíba-Ero Brasil, Mineração Vale Verde-Appian Capital Brazil, and AVB-BHP — there is a strong possibility that other players will enter the market in the not-too-distant future.

Among the companies that are already active in the market, several have announced investment plans to expand production, the most significant being those of Vale Base Metals and Ero Brasil.

Vale Base Metals, a Vale unit acting exclusively in the field of the energy transition minerals, operates Salobo and Sossego, both in the state of Pará, which in 2024 jointly produced 265,200 tons, roughly two-thirds of the company's overall copper output. In the near future, VBM production is expected to increase significantly, as investments in the range from US$ 25 billion to US$ 30 billion are planned to increase overall copper production from 350,000 to 900,000 tons per year.

Vale recently completed a new expansion, Salobo III, which includes a new plant, already operating on a commercial scale and bringing an additional 40,000 to 50,000 tons a year to the units previous capacity. The investment in Salobo III was of the order of US$ 1.1 billion. VBM is now considering various alternatives for the further expansion of Salobo, including the possible introduction of underground mining. The company is also studying the option of implementing its Salobo IV project, which would add another 30,000 tons per year of copper contained in concentrate to the unit's present capacity.

VBM is also studying the future development of Sossego, through the Southern Hub, which includes projects such as Bacaba, Cristalino, Visconde and Barão. With the Southern Hub, the expectation is that Sossego's useful lifetime could be extended beyond 2050. Another project in the company's portfolio is Alemão, in the Carajás region, whose projected capacity is 60,000 tons of copper per year.

Ero Brasil has now fully implemented its Tucumã project, in Pará, where it invested US$ 310 million. With its 55,000 tons a year, Tucumã brings the company's overall capacity in Brazil to 100,000 tons, placing Ero Brasil in second place among copper producers in the country, behind Vale. The company also has another project in the state of Bahia, named Deepening, which involves digging a shaft to access deep-lying ore. The project is budgeted at around R$ 1.4 billion and the implementation schedule is three years.

Despite being one of the largest agricultural producers in the world, Brazil is still heavily dependent on imports to meet its fertilizer consumption. This external dependence, mainly on potassium and phosphate, currently stands at around 85 percent.

In a move aimed at alleviating the imbalance between domestic supply and demand, the government has approved a National Fertilizer Plan, which aims to reduce Brazil's external dependence and provide greater competitiveness and sustainability to local producers, contributing to food security. The target is to increase output year by year, so as to reach 2050 with domestic production meeting between 45 and 50 percent of demand.

On the private-sector side, there are several projects in the pipeline. In 2024, EuroChem brought on stream its Serra do Salitre complex, in Minas Gerais, producing phosphates with an installed capacity of 1.2 million tons per year. It invested around US$ 1 billion in the project.

Fosnor/Galvani has two projects in the state of Bahia, the first being the duplication of the Luis Eduardo Magalhães plant, where it is investing R$ 500 million, and the second a new mining unit at Irecê, where it will mine primary ore in a partnership with state government owned CBPM (Companhia Baiana de Pesquisa Mineral). In this project, the planned investment is also R$ 500 million. The new Irecê project, to start this year, should be completed in 2026. At Luis Eduardo Magalhães, the project started in 2023 with the installation of a new sulfuric acid plant. A new granulation line and two more fertilizer storage facilities are now being set up. Production capacity is being doubled from 650,000 to 1.3 million tons per year. Both projects are scheduled for completion in 2026.

The company also has its Santa Quitéria project in the pipeline. It hopes to complete the permits procedure by mid-2025, with the expectation of fully implementing the project by 2028, with a production target of 1.2 million tons a year of phosphate rock and 200,000 tons of dicalcium phosphate, plus liquid fertilizer and technical grade phosphoric acid.

The venture will also produce 2,300 tons per year of uranium concentrate (yellow cake), to be handed over to the federal government's Indústrias Nucleares do Brasil (INB), which will reimburse Galvani for the production costs. With this new development, Brazil may become one of the ten largest uranium producing countries.

Morro Verde operates a mine in Pratápolis, in Minas Gerais, where proven reserves are 50 million tons of phosphate having an average concentration of 10 percent — which is twice the Brazilian average. The company has plans to almost quadruple its output capacity from 400,000 to 1.5 million tons per year. At this level of production, the company holds reserves for sixty years. Morro Verde's plan is to invest more than R$ 500 million over the next five years to increase production and launch new products on the market.

In potash, of which Brazil is a large importer, Potássio do Brasil finally obtained an installation permit for the potash processing plant at its Potássio Autazes project, in the state of Amazonas. The aim is to produce 2.2 million tons a year of potassium chloride, which amounts to around one-fifth of the country's consumption at present-day levels. The company expects to invest a further US$ 2.5 billion to construct an underground mine, a processing plant, and the logistics side, including a road and a port facility. At the end of 2024 Brazil Potash Corp., which holds Potássio do Brasil, went public with an IPO on New York's Nasdaq.