2Positive Outlook for the Brazilian Mining
Brazil has one of the major mineral patrimonies and is an important producer and exporter of high quality ores. Thats why Mining is one of the strengths of the Brazilian economy.
The Mining Industry is a sector that is responsible for the positive balance of the Brazilian trade, and the outlook of this economic activity is extremely optimistic for the coming decades.
Canada
Australia
United KingdomGermanySpain
Italy South Korea France
Holland
Mexico
Japan
IndiaChina
BRAZIL
EUA Russia
Bangladesh
Republic of Nigeria
Pakistan
Indonesia
Brazil in the world
Area > 3 million km2 Population > 150 million inhabitants
GDP > US$ 800 billion
Well known worldwide for its strong presence among major producing nations of iron ore, Brazil also excels in the production of several other minerals, among which, the aggregates for the construction and the cement industries, where we can observe a rapid increase in production. The inclusion of sustainability is growing in the Brazilian mining industry, a reason for the continued attention from entrepreneurs. The promotion of sustainability in the mineral activity is one of the main objectives of IBRAM Brazilian Mining Association (www.ibram.org.br), that represents this Industry.
www.ibram.org.br
region CompaniesCenter-West 942
Northeast 1.258
North 439
Southeast 3.392
South 1.901
Mining Companies in Brazil
DNPM The National Department of Mineral Production According to Annual Reports on Mining, DNPM registered 7,932 Companies in 2010, as follows:
Shut
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tock
The updated data on the Brazilian Mining can be found at the website
3the mining industrys share in the CommerCialtrade BalanCe
Exports Imports Surplus Source: MDIC/IBRAM
Brazilian balance in2006 US$ 46 billion
Mineral Sector 14%
Brazilian balance in2007 US$ 40 billion
Mineral Sector 25%
Brazilian balance in2008 US$ 24 billion
Mineral Sector 53%
Brazilian balance in2009 US$ 25 billion
Mineral Sector 50%
15.196
5.185
10.011
22.841
9.729
13.112
18.096
5.497
12.59911.030
6.5404.490
50.000
45.000
40.000
35.000
30.000
25.000
20.000
15.000
10.000
5.000
0
Millions of US$
2006 2007 2008 2009 2010 2011e
Brazilian balance in2010 US$ 20 billion
Mineral Sector 136%
Expected 2010 Brazilian Balance = US$ 23 Billion Balance of the mineral sector = 143% greater
35.360
7.756
27.604
43.000
10.000
33.000
Forecast
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4Brazilian Mineral Production
2011: Forecast of Brazilian mineral production totaled $50 billion
From year 2000 on, the increased demand for minerals, especially the high global growth rate, boosted the value of the PMB. During 2001/2011, the value of the PMB will register an increase of 550%, going from US$7,7 billion to US$50 billion. With the urbanization process and the strengthening of world economies, it is estimated that the PMB will keep growing between 10% and 15% per annum (pa) over the next three years.
growth oF Brazilian mineral produCtionIn US$ billions
Petroleum & Gas not included
0
5
10
15
20
25
30
35
78Years 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 09
40
50
10 11
Forecast
mineral produCtion: gloBal position oF Brazil
Source: DNPM; IBRAM/MME
Exporter (Global Player)
Exporter Self-sufficient Importer/ ProducerExternal
Dependency
Niobium (1st)Iron ore (1st)
Manganese (2nd)Tantalum (2nd)
NickelMagnesium
KaolinTin
LimestoneIndustrial diamonds
Titanium
Metallurgical CoalPotassium
Graphite (3rd)Bauxite (2nd)
Ornamental Stone
VermiculiteChromium
Gold
CopperTungsten
Talc
PhosphateDiatomite
Zinc
SulphurRare Earths
STRATEGIC
5Geological Survey
The Brazilian mining potential is significant. To date, only 30% of its immense territory is known through geological surveys in an appropriate scale for the activity. The Indigenous areas, that account for 13% of this territory and 25% of the Amazon, are among regions that may have their mining potential assessed, as well as the coastal area, located along the Brazilian continental platform.
The graphic shows that there is a repressed demand in the field of the geology survey in Brazil. Just to illustrate, although its land area is about seven times of that of Peru, Brazil allocates only half of the amount invested by that country on geological research.
Canada (US$ 2,03 billion) 19%
Australia (US$ 1,2 billion) 12%
US 8%
Mexico 6%
Peru 5%Chile
5%
Russia 4%
China 4%
Argentina 3%
Brazil (US$ 321 million)
3%
Other Countries 31%
10 leading countries Total: US$ 10,7 billion
Source: Metals Economic Group 2009
private investment in mineral explorationThe 10 COUNTRIeS ThAT ReCeIve MORe INveSTMeNTS IN MINeRAl exPlORATION
Generates 2,1 million direct jobs in Brazil
(160,000 created by the mining industry)
Date 2009
employment generation
multiplier eFFeCt: 1:13
importanCe oF mining For the generation oF JoBs
2
11
1416
12
8
4
0
Mining
Suppliers
First Transformation
Total
JobsThe total labor force employed in mining in 2011 reached 165 thousand workers. Studies from the National Department of Geology, Mining and Mineral Processing, of the Ministry of Mines and energy, show that the multiplier effect of jobs is 1:13 in the mining sector, ie, for each mining job, 13 others are created (direct employment) along the production chain.
Therefore, it can be assumed that the mineral sector in 2011, employs about 2.1 million workers (directly), not considering the vacancies generated in phasis of research, prospecting, planning, and workforce employed in the mines.
1
6Investments in the Mining Sector
Royalties
In 2010, the collection of CFEM (royalty) hit a new record: R$1
billion, or 46% higher than in 2009, which was R$742
million. In 2011 the forecast is that the collection should
reach R$1,3 billion.
The graphics on page 7 shows the evolution of the volume of investments in the mining sector in Brazil. The values calculated by IBRAM are projected for a 5-year period. The Association expects, based on data collected from the mining companies, a significant application of $68.5 billion for the period 2011-2015, which represents a new record for the Mining sector.
Thus, it is the private sector the one that invests most in the country - an average of more than $13 billion a year. This value is periodically reassessed by IBRAM.
The total forecast for the period 2011-2015 represents an increase of 10.5% in comparison with the previous period (2010-2014). Investments refer to the most varied minerals, and the Iron Ore, the leader among them, targets 65% of the total.
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