Ministry of Economic Development and Trade (Ontario)Brazilian Commercial Trade OfficeIn-Market Coordinator - Mr. Marcos José de Almeida Duarte

THE BRAZILIAN MINING SECTORTHUNDER BAY – TIMMINS – SUDBURY – NORTH BAY

Sector Overview

Production Data

Perspectives & Investments

Products in Demand

How We Can Help

BRAZILIAN OVERVIEWBRAZILIAN OVERVIEWArea: 8.5 million km² - 5th largest country (area) in the world.

Inhabitants: 185.7 million (est. 2010)

Brazilian is divided into five regions (26 states and the federal district)

Key Cities: São Paulo, Rio de Janeiro, Salvador, Belo Horizonte, Porto Alegre, Fortaleza, Recife and Brasília.

Official language: Portuguese

Currency: Real (R$)

Exchange rate: 1 CAD = 1.71 R$ (November 11th, 2010)

Chief of State: President Luiz Inácio Lula da Silva (until Dec. 2010)

Source: IBGE

BRAZILIAN MINING SECTOR OVERVIEWBRAZILIAN MINING SECTOR OVERVIEW

Brazil is among the world’s largest mining producers, along with Australia, Chile, China, the USA, Canada, Russia and South Africa.

In percentages of the world’s production, this represents:

# 1 Niobium producer, with 95%

# 2 Iron Ore producer, responsible for 17%;

# 2 Manganese producer, with 21%;

# 3 Bauxite, with 12,4%

# 3 Graphite producer, with 7,12%.

Source: IBRAM/DNPM

2009 Iron-ore Production

394 Million Tons

327 Million Tons

257 Million Tons

234 Million Tons

Mining companies: 73% are small-sized,

22.2% are medium-sized and

4.8% are large companies.

There are over 2,600 mines in Brazil.

Over 98% of these mines operate open

pit.

The states of Minas Gerais, Pará

and Goiás make up over 80% of

the mines.

Source: IBRAM/DNPM

Production: US$ 30 billionIncrease of 11% over 2007

Iron ore production increased 6%

MINING PRODUCTION DATAMINING PRODUCTION DATA

2008 2009

Production: US$ 25 billionDecrease of 17% over 2008

Mining Investments: US$ 5.2 billionDecrease of 10.2%

Iron 327Mt, Bauxite/Alumina 36.9Mt,Copper 217Kt, Manganese 1.7Mt,

and Koalin 2Mt

Although the Brazilian mining sectorwas affected by the 2008/09 international

economic crisis, the mining companies have been increasing investment in

order to recover

Bauxilie/Alumina 34 Mt, Manganese2.4Mt, Copper 222Kt and Kaolin 2.6Mt

Mining industry/mineral transformation:US$ 89.4 billion. It represented a 5.25%

share of the brazilian GDP

Source: MME/IBRAM/DNPM

INTERNATIONAL TRADEINTERNATIONAL TRADE

The commercial balance increased over seven times from 2001 to 2008. Production exported: US$ 22.8 billion; the positive balance reached US$

13.1 billion Main exported substances: iron ore (82,6%), ornamental stones (6,5%),

copper (6,2%), kaolin (2,4%), bauxite (1,9%) and others (1,35%)

1.75 1.78 1.95 2.41

5.32 6.51

8.62

13.1

02468

101214

2001 2002 2003 2004 2005 2006 2007 2008

Commercial Balance Total

*In Billion US Dollars

*

Source: AliceWeb (MDIC)/IBRAM

PERSPECTIVES & INVESTMENTSPERSPECTIVES & INVESTMENTS

It is estimated that between 2009 and 2013 Brazilian corporate investment in the mining sector will total US$ 62 billion; an average of US$ 12.4 billion per year.

Investments are planned to increase iron ore, bauxite, aluminum, copper, and gold extraction.

Production of iron ore and nickel are expected to rise sharply until 2013.

The amount of investments in the state of Minas Gerais exceeded 50% of what was invested the previous year.

Source: MME/IBRAM/Valor/PriceWaterHouseCoopers

PERSPECTIVES & INVESTMENTSPERSPECTIVES & INVESTMENTS

Due to the worldwide importance of the Lithium, Brazil estimates higher investment to increase the extraction of Lithium (1,3% of the world’s reserve).

Federal Investment: Plano Mineral 2030 intendsto double mineral production in 20 years, reaching

the amount of a billion tons of iron ore (150%above the volume that is now being produced)

Source: MME/IBRAM/Valor/PriceWaterHouseCoopers

PLANNED INVESTMENT BY MAIN PLANNED INVESTMENT BY MAIN COMPANIESCOMPANIES

Vale, the second largest mining company in the world plans on:

- Investing US$12.9 billion in 2010;- Investing US$24 billion in 2011;- Duplicating its production in 5 years;- Working on 18 different projects between 2010-

2012;- All investments aim at improving equipment, rail

roads, loading/transportantion and water capturing.

*Vale looks at developing contact with new international supliers.

Source: Vale/IBRAM/Valor

PLANNED INVESTMENT BY MAIN PLANNED INVESTMENT BY MAIN COMPANIESCOMPANIES

CSN(Companhia Siderurgica Nacional): - Increase production to 40Mt/year (Mine Casa de Pedra)

SAMARCO - Duplication of pellet production

MMX - Increase mining production capacity to 46Mt per year

ALUNORTE- Grow production capacity from 4,4Mt

to 6,3Mt of Aluminum per year

Source: Valor/Vale/MMX/Alunorte/IBRAM

PRODUCTS ON DEMANDPRODUCTS ON DEMAND

Earth-movers

Belt Conveyors

Crushers/Grinders

Laboratory instruments

Drill pieces

Carriers/loaders

Management and controlling Software

Security devices

Source: IBRAM/Vale

MAIN MINING COMPANIESMAIN MINING COMPANIES

CANADIAN MINING COMPANIES IN CANADIAN MINING COMPANIES IN BRAZILBRAZIL

PLANNED TRADE SHOWS (2011-PLANNED TRADE SHOWS (2011-2012)2012)

EXPOSIBRAM (2011) – Belo Horizonte *The most important

M&T Expo (2012) - International Trade Show of Construction and Mining Equipment

Sul Metal e Mineração (2012)

CBMina (2012) – Congress of Open Pit and Underground Mining

Equipo Mining (2012)

Certifications &Regulatory Issues

Analyze the competitors

Understandthe product and

the market

Importance offinding a

partner in the local market

Establish partnerships and local customers

How to doBusiness in

Brazil

HOW WE CAN HELPHOW WE CAN HELP

Market Analysis

Partner Search

Contacts with local companies

Preparation of an agenda of meetings

Follow-up contacts

REFERENCESREFERENCES

IBRAM (Brazilian Mining Institute) DNPM (National Department of Mineral Production) MME (Ministry of Mines and Energy) Valor (Business Publication) IPEA (Brazilian Institute of Applicable Economic Research) MDIC (Ministry of Development Industry and Trade) AliceWeb PriceWaterHouseCoopers

THANK YOUTHANK YOU

Ontario Ministry of Economic Development and TradeBrazilian Commercial Trade Office

Porto Alegre / São Paulo / Rio de JaneiroPhone: +55 (51) 3212-6612 or 3227-8341

mj.mj@terra.com.br or marcos.jose@plugin.com.br