What Anglo American is planning for Brazil

Late last year Anglo American appointed Ana Sanches as its CEO for Brazil, making her the first woman to lead a major miner in the country. Likewise, she was recently named chairwoman of the local mining association Ibram.

Sanches, who will manage Anglo American investments of up to 13bn reais (US$2.6bn) through 2028, spoke with BNamericas about her plans.

BNamericas: What are the priorities and challenges at Anglo American in Brazil?

Sanches: We have work that has been done but needs to be intensified, which is communication work.

We need to show society, the communities in the region where we operate, the importance of mining. How essential our industry is and at the same time show that we can and are operating in a responsible way, in a sustainable way.

We want to work together with society, actively listening to understand demands in a transparent way so that people trust our work. I would say this is a more general aspect.

Here at Anglo American I also want to leave a legacy with the people who work here, make people want to work with us, create opportunities, make people feel challenged, in a safe, integrated work environment that leaves people psychologically safe.

I want to reinforce Anglo American's excellence in its relationship with communities, the environment, water management, and advance throughout our journey linked to decarbonization.

BNamericas: Anglo American has announced an investment plan of approximately 13bn reais through 2028. Could you tell us how this will be invested and how this is related to the objectives you mentioned?

Sanches: Around 4bn reais are being invested in a waste filtration plant in the operational area in Minas Gerais state.

It’s a very significant investment because with this we’ll be able to filter 85% of the waste from the Minas-Rio [iron ore] complex and avoid sending the waste to the dam.

Furthermore, we also have a series of initiatives related to actions with the communities where we operate.

BNamericas: What are the initiatives underway at Anglo American in Brazil to reduce greenhouse emissions?

Sanches: Since 2012, 100% of our energy contracts are from renewable sources. In 2022, our partnership with Casa dos Ventos began to produce wind power. 

But we still have challenges that we want to overcome, which are related to our heavy equipment, which is still largely diesel-powered.

Two years ago, we launched the development of a hydrogen-powered truck project in South Africa, which shows our global efforts towards reducing emissions.

At the same time, we want to bring 10 hybrid trucks to our fleet in Brazil to operate in our Minas-Rio project and later moving towards solutions related to our other heavy machinery.

[Editor’s note: The hybrid trucks mentioned have already been acquired by the company's international unit.]

BNamericas: What other initiatives related to sustainability are being considered by the company?

Sanches: We also have several studies underway to increase water reuse in our operations. We have initiatives underway to reuse water in Porto do Açu.

[Editor’s note: The company wants to increase the reuse of water used in the 529km pipeline that transports iron ore from Conceição do Mato Dentro, in Minas Gerais, to São João da Barra port in Rio de Janeiro.]

We are working to diversify towards sustainability.

BNamericas: Anglo American in Brazil recently released a production forecast for 2024 of 23-25Mt of iron ore and 36,000-38,000t of nickel and for 2025, 22-24Mt of iron ore and 35,000-37,000t of nickel. Is this guidance still valid?

Sanches: Yes, the guidance is maintained. In 2025 we will have a reduction in production because every five years we have to comply with an inspection protocol for our ore pipeline.

BNamericas: What is the projection for the nickel and iron ore markets this year?

Sanches: In nickel we have seen a drop in prices, due to the issue in Indonesia [new nickel projects starting up] and there is doubt about how the dynamics of supply and demand will behave. What we’ve heard from analysts is that prices will not recover much throughout the year.

In the case of iron ore, we have a product with a great difference, which is a high-grade ore, demanded by companies seeking to produce green steel.

However, although our main customers are currently in the United Arab Emirates, Japan and a few in China, China is still the one who dictates the price dynamics of iron ore, which is why the price depends greatly on the performance of the Chinese economy.

BNamericas: What does the recently announced agreement between Anglo American and Vale, in relation to Anglo American's Minas-Rio assets and Vale's iron ore resources in Serra da Serpentina, in Minas Gerais, mean?

Sanches: This agreement, once approved by regulatory bodies, represents the longevity of the company's iron ore operations in Brazil and is a positive agreement for the region.

Following this agreement, we’ll begin to develop studies for the mine expansion phase.

BNamericas: You recently assumed the role of chairwoman of Ibram’s board. How do you assess the current Brazilian mining business environment in general?

Sanches: I see the mining sector in Brazil demonstrating a lot of desire nowadays to do the right thing, to work in harmony with society.

At Ibram, I see that we increasingly have to assume the task of being a single voice among all mining companies, large and small, seeking understanding on important topics in the sector.