Due to better governance practices and a commodity boom, Brazil’s economy has enjoyed incredible growth over the past 20 years. Brazil is now the largest economy in Latin America and the sixth or seventh largest economy depending upon the metric used. On the other hand, while Brazil’s GDP per capita has improved, it still ranks at a relatively low 64th in the world – meaning that it is a large economy, but not an especially wealthy one yet (at least not uniformly so). While Brazil has made a concerted effort to build up its manufacturing sector (and reduce the risk of being trapped as a commodity-driven economy), minerals, energy and agriculture are still very significant to the Brazilian economy, as well as the larger global economy [for more commodity news and analysis subscribe to our free newsletter].
Mining is still a significant industry within Brazil, as it accounts for nearly 4% of GDP and about 6% of employment. Nearly 20% of the country’s exports consist of various minerals and metals, and Brazil is a leading producer of many key industrial commodities.
Iron ore is the most significant commodity with Brazil. The country produced over 370 million tons of iron ore in 2010, making it the third-largest producer in the world (after China and Australia). Iron ore alone is more than 15% of Brazil’s export value (with about half of it going to China), and most of it is mined in the three states of Minas Gerais, Maranhao and Para. While Brazil is best known for its iron ore exports, it’s also a large and increasingly significant producer of steel (currently #10 in the world) [see also A Deeper Look At Australia's Commodity Industry].
While iron’s importance to the global steel trade is well known (as is Brazil’s importance in the iron trade), much less well-known is niobium. Niobium is used in a variety of steel and nickel alloys, particularly those that need to resist considerable heat and mechanical stress. Niobium doesn’t leap off the page in terms of dollar contributions to Brazil’s exports, but Brazil currently produces more than 90% of the world’s supply.
In terms of export value, gold comes next after iron ore for Brazil. The country isn’t a major gold producer (55 tons in 2011 was good for 13th place in the world), though the fact that its reserves are the 7th-largest in the world suggests production could still increase from current levels.
Brazil also produces a significant amount of other industrial metals and minerals. Although Brazil is not a top-10 producer of copper, it does find a place among the country’s top mineral exports. Brazil is the third-largest producer of bauxite in the world (and holds more than 10% of the world’s reserves) behind Australia and China, and is the sixth-largest producer of aluminum.