Brazil miners line up investments of nearly US$70bn

The Brazilian mining sector is preparing investments of US$68.4bn in 2025-29.

"The main highlights of this new cycle of investments are iron ore mining projects, as well as the investments by mining companies in infrastructure and also environmental and social measures," said Raul Jungmann, president of local mining association Ibram, during the presentation of the projections.

The figure is up 6.6% from the US$64.2bn forecast for 2024-28.

Of the total, iron ore projects are expected to account for US$19.6bn, up 13.4% from the 2024-28 forecast; environmental and social projects of mining firms US$11.3bn, a rise of 6.2%; and logistics US$10.9bn.

Last year, 60% of the sector’s revenues were generated by iron ore.

Meanwhile, ESG issues are expected to remain prominent, with companies in the mining industry investing in environmental and social projects, including renewable energy.

"Although we have signals contrary to ESG, mainly from the current government in the United States, we see that companies in Brazil are maintaining a firm commitment to this agenda, and I believe that Brazil can increasingly become a global protagonist in the energy transition," André Pepitone, CFO of the Itaipu Binacional hydro dam operator and former head of Brazil’s electric power regulator Aneel, told BNamericas on the sidelines of the Energyear 2025 conference in São Paulo.

CRITICAL MINERALS

The new US administration under Donald Trump is likely to provoke certain changes in the mining sector globally, but it is not expected to impact the demand for critical minerals, including copper.

"Critical minerals will continue to have strong appeal. What changes is that during the administration of Joe Biden, this appeal was fueled by the energy transition agenda, and now with President Trump's administration, I see this being driven by projects associated with the defense and technology industries," said Jungmann.

Investments in copper projects in Brazil are forecast to reach US$7.31bn in 2025-29, up 8.4% from US$6.74bn in 2024-28. 

Investments in rare earths a projected to rise 49% to US$2.17bn while gold projects are likely to attract US$2.15bn, an increase of 39.3%, according to Ibram.

LITHIUM, NICKEL

On the other hand, investment projections for lithium and nickel were reduced in the latest forecast.

Lithium projects are likely to receive investments of US$1.16bn in 2025-29, down 2.4% from 2024-28, while the nickel sector is forecast to attract US$3.82bn, down 14.1%.

"The reduction in the volume of investments for lithium and nickel projects is associated with the fact that we had a significant price drop during 2024. As there is a recovery in prices, I see the possibility of an increase in these investments," said Julio Nery Ferreira, director of sustainability at Ibram.

TAXES

Ibram announced that it is seeking to reverse a new tax that has been introduced for the sector.

After extensive negotiations, President Luiz Inácio Lula da Silva earlier this year signed into law the regulation of the tax reform approved by congress, but the mining sector was displeased with a new tax that has been introduced.

The reform aims to simplify Brazil's complex tax system by replacing levies such as PIS, Cofins, IPI, ICMS and ISS with the federal and state IBS and CBS duties, equivalent to value-added tax in other countries. As part of this reform, the government has also approved the so-called selective tax, which applies to activities related to mining, oil and gas.

Although mining stakeholders managed to block the selective tax during congressional discussions, the government reinstated it once the law was signed, so it will now be applied, with a maximum rate of 0.25% on exports of mining products.

"We see this tax as unconstitutional, and through negotiations with the government we will still try to reverse its application. However, if these discussions are not sufficient, we will have to resort to the courts to reverse this," said Jungmann.