BMI View: Brazil's mining sector will grow steadily over our forecasts to 2019. However, the country's mining industry's value growth will slow over the coming years. Still , mine output will expand as both domestic and foreign firms increase production of both industrial and precious metals.
Brazil's mining industry value will grow 3.3% on average per annum to 2019, largely on the back of iron ore sector investment and output. Iron ore makes up around 85% of the country's total mining export value, though weak prices will mitigate the positive effect of growing export volumes. In the case of iron ore, we forecast prices will average lower year-on-year (y-o-y) in 2015 at USD60/tonne, compared to USD97/tonne in 2014. Beyond 2015, prices will experience nearly flat growth to 2019. Nevertheless, Brazilian firm Vale will continue to take advantage of its low unit costs and seek to increase its global market share as higher-cost production in other countries comes offline. Vale cited cash costs slightly above USD23/tonne in Q414, with costs dipping to as low as USD11/tonne for certain mine assets. Furthermore, US dollar strength, and resultant depreciation in the Brazilian real, will further cap input costs, which are denominated in local currency. Shipping times and costs to China are longer and higher compared with Australian iron ore producers though, which may lead to Australian producers capturing a greater share of the Chinese iron ore import market.
| Growth To Resume, But No Return To Boom |
|Brazil - Mining Industry Value & Growth|
| e/f = BMI estimate/forecast. Source: BMI, IBGE |
Brazil will also see positive base and precious metals production growth despite a more muted external market. Bauxite and nickel production growth will continue, though we believe gold output is likely to grow the slowest in percentage terms due to falling gold prices through 2016. Indonesia's ongoing ban on unprocessed nickel and bauxite ore, and its higher purity...
The Brazil Mining Report has been researched at source and features Business Monitor International (BMI)'s mining and commodity forecasts for metals, minerals and gems, covering all major indicators including reserves, production, exports and values. The report also analyses trends and prospects, national and multinational companies and changes in the regulatory environment.
BMI's Brazil Mining Report provides industry strategists, service companies, company analysts and consultants, government departments, trade associations and regulatory bodies with BMI's independent forecasts and competitive intelligence on the mining industry in Brazil.
- Use BMI's independent industry forecasts on Brazil to test other views - a key input for successful budgeting and planning in this mining market.
- Target business opportunities and risks in Brazil's mining sector through our reviews of latest mining industry trends, regulatory changes and major deals, projects and investments in Brazil.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. KPIs and latest activity), Key Projects Tables and Competitive Landscape Tables.
BMI Industry View
Summary of BMI’s key forecasts and industry analysis, covering mining reserves, supply, demand and prices, plus analysis of landmark company developments and key changes in the regulatory environment.
Industry SWOT analysis
Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the mining sector and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series (2009-2013) and forecasts to end-2019 for key industry and economic indicators, supported by explicit assumptions, plus analysis of key risks to the main forecasts. Indicators include:
- Mining industry: Industry size (USDmn), real growth (%), % of GDP, employment (‘000), workforce as % of total workforce, average wage (USD).
- Output: Production volumes (‘000 tonnes, carats etc.) for all major metals, minerals, ores and gems mined in each state, including bauxite, copper, gold, coal, lead, silver, tin, titanium, uranium, zinc etc.
- Exports: Value of exports (USDmn) for all major metals, minerals, ores and gems mined in each state.
- Commodity markets: Global demand, supply, stocks and benchmark prices (USD) for aluminium, copper, lead, nickel, tin, zinc, gold and steel.
BMI’s Mining Risk Reward Index
BMI’s Risk Reward Indices provide investors (mining companies and support service providers) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors, with each position explained.
Competitive Landscape Tables & Analysis
Comparative company analyses and tables detailing USD sales, % share of total sales, number of employees, year established, market cap/NAV, ownership structure, production and % market share.
Details and analysis of all current and planned developments (new ventures, capacity expansion and other investments) across the sector broken down by metal/ore.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
The Mining reports are based on an extensive network of primary sources, such as multilateral organisations (UN, WB, IMF), national chambers of commerce and industry, national statistical offices, government ministries and central banks, and multinational companies.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.