A Deeper Look At Brazil’s Commodity Industry

Page 1 of 3

A Deeper Look At Brazil’s Commodity IndustryDue 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

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.

Page 1 of 3
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The 10 Largest Pharmaceutical Companies In the World

The 10 Most Expensive Android Apps

The 9 Most Expensive Designer Bags in the World

The 7 Most Expensive Real Estate in the World

The 10 Most Expensive eBay Items Ever Sold

The 10 Most Expensive iPhone Apps

The 9 Most Expensive Designer Shoes in the World

The 10 Most Expensive Cigarette Brands

The 10 Most Expensive Law Schools in the US

The 10 Best Wall Street Movies

The 10 Most Expensive Golf Clubs Ever Sold

The 10 Most Expensive Golf Memberships

The 10 Best Disney Characters Ever Created

The 8 Best Foods for Gaining Weight

The 10 Most Expensive Colleges in the World

The 7 Most Memorable Ad Campaigns of All Time

The 7 Most Expensive High Schools in the World

The 10 Electric Vehicles with the Longest Range

The 10 Cities with the Worst Drivers in the World

The 10 Most Expensive Dresses Ever Created

10 Islands to Visit Before You Die

10 Famous Celebrities Who Needed Rehab

The 15 Countries with the Largest Oil Reserves

The 10 Most Overused Excuses in the World

The 5 Best iOS Apps You Can’t Get on Android

5 Companies Damaged By Social Media Blunders

The 10 Most Legendary Blues Songs

The 10 Most Lawless Places in the World

4 Reasons China is a Threat to the US

The 17 Most Sugary Drinks in the World

The 10 Most Ruthless Rulers in History

The 10 Greatest Generals in History

Top 8 Travel Destinations for 2015

The 10 Safest Dog Breeds for Children

The 10 Most Stolen Vehicles in the US

The 7 Most Expensive Celebrity Weddings

The 10 Best LoL Teams in the World

Top 10 Worst Marketing Campaigns Ever Produced

Top 5 Diets that Help You Lose Weight

The 10 Best Ways to Stay Awake

7 Artists That Switched Musical Genres

The 10 Most Expensive Cities to Live in New Jersey

The 10 Best High Schools in New York

The 10 Countries With the Least Gender Inequality

The 6 Biggest Musician-Manager Feuds

The 10 Countries with the Cheapest Gas Prices

The 7 Most Theatrical Bands of All Time

The 8 Worst Band Breakups of All Time

The 10 Most Important South American Leaders

The 7 Most Successful Casting Show Winners

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!