How big is mining in Brazil?

Mining is a huge topic and I’ll only be able to scratch the surface and try to get an idea of just how big mining is in Brazil to start.

Depending on where you go, the importance of mining is easy to see. I traveled around the state of Minas Gerais last November, and mining activity was happening absolutely everywhere (an unemployed tour guide on my bus was happy to point out each example of mining activity we passed). Mining is important and growing fast in Bahia, though it isn’t as obvious from the window of a bus. Perhaps Brazil’s most well known company is Vale, a mining giant that was privatized in 1997 and went on to acquire other mining companies the world over. President Dilma reached the national stage as Minister of Mining and Energy, before switching to Lula’s chief-of-staff.

The ministry of mining and energy provides a nice easy-to-read statistical synopsis of the Brazilian mining industry (though the latest version available is from 2009, with the latest data being from 2008). It cites the GDP of the mining industry at US$ 16.5 billion, or 1.05% of the nation’s total GDP in that year. Mining products are an important export as well, helping produce the foreign trade surplus that Brazil enjoys. Here go a few 2008 statistics for mining as well as mining together with the “mineral transformation” industries, which produce things like steel and fertilizer (M + MT means “mining plus mineral transformation”).



Notably, mining’s share of GDP since the 1970’s has fallen from around 7% to between 4% and 5% today. Without researching it further, I attribute this more to the development of other areas of the economy than to poor performance of mining.

The combination of mining and mineral transformation also accounted for over 1.2 million formal jobs in Brazil in 2008 (I would like to compare this to the size of the national economically active population, but this statistic is only available for selected cities).

Aside from being fairly huge, the mining industry is growing fast. Mining exports grew over 30% in 2008 and employment in the sector grew 8%. A more updated tidbit from the Mining Association claims that mineral production grew 67% (!) in 2010 compared to 2009, reaching US$ 40 billion after a slight decline in 2009 due to the international crisis (I’m not sure to what degree this figure might be influenced by the declining dollar). Over 7,000 mining companies currently operate in Brazil, and investments by major companies are increasing.

The synopsis also provides the major mineral products in order. Here go the top exports by value. You can see the importance of the iron industry in Brazil relative to other minerals.



Unfortunately, that’s all for today. More later!