What to expect from Brazil’s mining sector in 2025

The performance of the Brazilian mining sector in 2025 is likely to be fairly similar to this year, according to mining association Ibram.

Mining companies posted combined revenues of 186bn reais (US$33bn) in the first nine months of this year, up 7% from the same period of last year, according to figures presented by the association at a press conference.

"Looking ahead to 2025, we will have a scenario of increased production, as some projects in the sector are likely to enter the production phase. In terms of revenues, the trend is expected to be similar to what we’re seeing this year," said Ibram president Raul Jungmann, responding to a question from BNamericas.

"In 2025, we will see continued growing demand for projects involving critical minerals associated with the energy transition, such as lithium, copper and niobium, among others," Jungmann said. “However, the Brazilian mining sector continues to be significantly influenced by the performance of the iron ore segment, as most of the revenues and investments in the sector come from that area."

In the third quarter, iron ore accounted for 55.4% of sector revenues, with 70% of the total shipped to China.

"The latest announcements from the Chinese government regarding economic stimulus are somewhat positive for iron ore demand next year. We must also not forget that iron ore produced in Brazil has an appeal associated with reducing greenhouse gas emissions because it’s a high-quality product with fewer contaminants," Afonso Sartorio, EY's mining and metals sector lead for South America, told BNamericas.

The attractiveness of Brazil’s iron ore is generating deals.

Earlier this week, Brazilian industrial group CSN announced that Japanese conglomerate Itochu Corporation had agreed to increase its stake in its iron ore arm, CSN Mineração.

Itochu, which currently owns a stake of 9.26% in CSN Mineração via Japan Brasil Minério de Ferro Participações LTDA, will acquire an additional stake of up to 11%.

The companies did not disclose the value of the operation, while CSN Mineração’s market value was 32.4 billion reais on Wednesday.

The purchase is occurring as the largest project in the pipeline of CSN Mineração, the Itabirito P15, or Casa de Pedra, in Minas Gerais state, is advancing.

The company plans to start production in the first quarter of 2027, with a capacity of 15 million tons per year. Itabirito is considered by the firm to be a transformative project, as it will improve its iron ore quality by increasing the iron content from 58% to 65% by 2028.

CAPEX

Ibram stated that it maintains its latest investment forecast for the mining companies operating in Brazil.

According to the forecast, the sector will invest a combined US$64.5bn in 2024-28, up from US$50bn in the 2023-27 projection.

"We will present investment projections for the new 2025-29 period in January of next year. We always make projections for a five-year period because most mining companies define their capex plans in this format," said Julio Nery Ferreira, director of sustainability at Ibram.

TAXES

Meanwhile, the mining sector continues its efforts to avoid higher taxes.

In July, the lower house approved key regulations for the tax reform passed last year, aimed at simplifying Brazil’s complex tax system.

The reform replaced taxes such as PIS, Cofins, IPI, ICMS, and ISS with the federal and state IBS and CBS taxes, which are applied similarly to VAT in other countries.

The lower house also authorized a selective tax on activities deemed harmful to health and the environment, which was initially set at 1% but was reduced to 0.25% due to pressure from the mining industry. Although the sector secured a partial victory, it continues to push for the complete removal of this tax, which is under discussion in the senate.

"We’re totally opposed to this selective tax against mining, firstly because mining is not a sector with a negative impact on the environment; on the contrary, it is crucial for the energy transition. Secondly, there should be no taxes on products that are exports, as is the case with Brazilian mining," said Fernando Azevedo e Silva, the association’s VP.