In 2011, the Brazilian Mineral Production (BMP) is expected to reach a new record of US$50 billion, which would represent a 28% increase as compared to the US$39 billion in 2010. Hence, in 2011 the BMP will show its recovery after the 2009 international economic crisis, which resulted in a decrease in demand for mineral raw materials.
BRAZIL IN THE WORLD Area > 3 million sq.km Population > 140 million inhabitants
Russia
Pakistan
Indonesia
Canada USA
Region Center-West
in US$ billions
0
Years 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 0910 11
Petroleum & Gas not included Forecast
BRAZIL
Brazil has one of the largest mineral deposits and is one of largest mineral producers and exporters.
MINERAL PRODUCTION: GLOBAL POSITION OF BRAZIL EXPORTER GLOBAL PLAYER Niobium (1st) Iron ore (1st) Manganese (2nd) Tantalum (2nd) Graphite (3rd) Bauxite (2nd) Ornamental Stone EXPORTER Nickel Magnesium Kaolin Tin Vermiculite Chromium Gold SELF-SUFFICIENT Limestone Industrial diamonds Titanium Copper Tungsten Talc STRATEGIC Phosphate Diatomite Zinc IMPORTER / PRODUCER EXTERNAL DEPENDENCY Metallurgical Coal Potassium
Brazil is an important player in the worlds mining industry. However, it still depends on some minerals that are key to the economy. Brazil is the fourth largest consumer of fertilizers, and responds for only 2% of the worlds production. The Country imports 91% of the potassium and 51% of the phosphate needed, both essential for the fertilizers industry.
Data collected by CFEM (Financial Compensation for Mineral Resources Exploitation) indicates that the states with the largest ore production in 2010 were:
Minas Gerais (48%), Par (28%), Gois (5%), So Paulo (4%), Bahia (2.7%), Mato Grosso do Sul (1.8%), Sergipe (1.7%), and Others (8.8%). In 2010, CFEM reached another record: R$1billion, or a 46% increase in collections as compared to the R$ 742 million million in 2009. For 2011 the forecast is to reach R$1,3 billion.
CFEM
1400 1200 1000 800 600 400 200 0 CFEM 2004 326 2005 406 2006 466 2007 547 2008 858 2009 742 326 406 466 547 858 742
Millions of R$
1.300 1.083
2010 1.083
2011e* 1.300
*forecast
27.604
22.841
30.000 15.196 5.185 10.011 25.000 11.030 4.490 6.540 20.000 15.000 10.000 5.000 0 2006
Brazilian Balance in 2006 US$ 46 Billion Mineral Sector: 14%
9.729 13.112
18.096
12.599
7.756
10.000
2007
2008
2009
2010
2011e
Brazilian Balance in Brazilian Balance in Brazilian Balance in Brazilian Balance in 2007 US$ 40 Billion 2008 US$ 24 Billion 2009 US$25 Billion 2010 US$20 Billion Mineral Sector = 25% Mineral Sector = 53% Mineral Sector = 50% Mineral Sector = 136%
Expected 2011 Brazilian Balance = US$ 23 Billion | Balance of the mineral sector = 143% greater.
Exports
5.497
Imports
In 2011, Iron Ore will remain #1 in the list of products that generate the highest revenues among Brazilian exports.
35.000
33.000
40.000
35.360
45.000
43.000
50.000
Surplus
The mining industry in Brazil and its importance for the trade balance
Millions of US$
BRAZIL
Main products exported and imported in 2010 and forecast for 2011 (in US$)
Exports % of value exported in US$
MAIN PRODUCTS EXPORTED AND IMPORTED Mineral Exports Primary Goods Iron Ore Gold (in bars) Niobium (iron-niobium) Copper Silicon Kaolin Manganese Ore Bauxite Tin Lead Granite
2010 35,360 28,912 1,786 1,557 1,238 460 275 357 270 8 12 219 268 7,756 3,575 2,204 952 157 246 623 27,604
e
2011e 43,595 35,745 1,988 2,034 1,806 637 258 276 322 20 12 230 268 10,023 5,078 2,904 1,232 10 176 623 33,572
Copper 4,1% Silicon 1,5% Manganese 0,6% Bauxite 0,7% Kaolin 0,6% Others 0 ,6% Granite 0,5%
Copper Zinc
Sulphur 1,8% Zinc 0,1% Others 6,2%
Coal 50,7%
14 11
Multiplier Effect: 1 : 13
In 2011, a total of 165,000 workers were employed by the mining industry in Brazil. Studies undertaken by the National Secretariat of Geology, Mining and Mineral Transformation of the Ministry of Mines and Energy show an employment ratio of 1:13 in the mining industry, i.e. for each position created in the mining industry, another 13 direct jobs were created along the productive chain, and that added to other indirect jobs. Therefore, one may consider that in 2011 the mineral sector employs about 2,1 million workers directly, apart from the jobs generated during exploration, prospecting and planning stages, and the people working in the garimpos (panners).
Date: 2011
Source:National Secretary for Geology, Mining and Mineral Transformation of the MME
BRAZIL
Information and Analyses of The Brazilian Minerals Economy | 6TH edition EXAMPLES OF MINING MUNICIPALITIES AND THEIR RESPECTIVE IDH IN COMPARISON TO THE IDH OF THE STATE
Municipality -State Itabira - MG Arax - MG Nova Lima - MG Catalo - GO Cachoeiro de Itapemerim - ES Parauapebas - PA Barcarena - PA Presidente Figueiredo - AM Mineral Iron Niobium Gold Phosphate Ornamental Stone Iron Bauxite Cassiterite State IDH Municipal IDH 0.766 0.766 0.766 0.773 0.767 0.720 0.720 0.713 0.798 0.799 0.821 0.818 0.770 0.740 0.769 0.742
Source: UNDP
The graph shows an increase in the amount of investments in the Brazilian mining sector. The numbers compiled by IBRAM are forecast for a fiveyear period. Based on data collected from mining companies, the Institute foresees significant investments in the amount of US$68.5 billion for the period 2011-2015, and a new record for the mining industry. The private sector invests more in the Country, an average of over US$13 billion per year. This amount is periodically reassessed by IBRAM, as shown in the graph. Investments in the amount of US$68.5 billion forecast for the period 2011 to 2015 represent an increase of 10.5% as compared to the period 2010-2014. These investments apply to a number of minerals, and since Iron Ore is the most significant one, it will take 63% of the total.
80 Investments in the mineral sector 70 60 50 40 30 20 10 sep/07 may/08 sep/08 may/07 mar/09 mar/07 mar/08
25 28
2007-2011 2008-2012
Billions of US$
2010-2014
2011-2015
57
62
64,8
68,5
48
2010-2014 2009-2013
47
49
54
32
Billions of US$
New investments in the mineral sector 2011 to 2015: US$ 68,5 billion Investments in the mineral sector 2010 to 2014: US$ 62 billion
5.220 8.187 6.550 6.716 1.890 2.510 2.542 2.657 2.418 2.030 2.675
0 400 Manganese 300 400 Niobium 66 Zinc 631 0 Limestone 310 0 200 Vanadium 270 40 Coal 44 310 0
Phosphate
Potassium
Iron Ore
Alumina
Copper
Nickel
Gold
may/11
0 jan/07
aug/10
nov/07
apr/10
jan/10
jan/08
jan/11
jul/07
jul/08
BRAZIL
Private Investment in Mineral Exploration
Canada
(US$ 2,03 billion)
19%
Brazil
(US$ 321 million)
Australia
(US$ 1,2 billion)
Despite significant investments in production/extraction, Brazil still invests little in mineral exploration. In 2009 and 2010 the country received only 3% of the worlds total private investment in exploration, and ranks well behind smaller countries, such as Peru and Chile. Besides, less than 30% of the Brazilian territory is geologically mapped in the 1:100,000 scale.
12%
Investments in mineral exploration in the world Global Investment (US$ 10.700.000) Brazil Canada Australia Peru USA Mexico Russia Chile China Argentina Area (sq.km) x 1.000 8547 9971 7682 1285 9373 1973 17075 757 9600 2780 Absolute Investments (US$) 321.000 2.033.000 1.284.000 535.000 856.000 642.000 428.000 535.000 428.000 321.000 Share of Investments (%) 3 19 12 5 8 6 4 5 4 3 Absolute Investments/Area (US$/ sq.km) 0,0 0,2 0,2 0,4 0,3 0,0 0,7 0,0 0,1 0,1 Brazil Investment vs Countries 1 5.4 4.5 11.1 2.4 8.7 0.7 18.8 1.2 3,1
US$ 1.000
The table shows the disparity between the total amounts invested by countries assessed as compared to Brazil. The analysis takes into account the countries sizes, and confirms that smaller countries (Peru, Chile and Mexico) or countries of similar territorial areas overcome Brazil in exploration investment (except for Russia).