Industry Trend Analysis - Iron Ore To Be Sector's Growth Bright Spot - OCT 2015

BMI View: Brazil's iron ore industry will remain the country's mining growth bright spot, as output will be supported by the sector's strong project pipeline, low production costs and high-grade ore deposits . Gold and tin mine output will underperform due to continued price weakness .

Although Brazil's mining sector will continue to be supported by the country's vast mineral deposits, low mineral prices will curb the sector's growth outlook over the coming years. We forecast Brazil's mining industry value to average annual growth of 1.2% from 2015-2019, with growth notably picking up by 2017. Growth will be primarily supported by continued iron ore sector investment. For instance, Vale, the country's dominant iron ore miner, will invest USD4.0bn in H215, following on USD4.3bn in the first half of 2015. Gold and tin will be the sector's underperformers, as continued price weakness will force miners to scale back or even halt operations over the coming quarters.

I ron Ore To Be Sector's Growth Bright Spot

Mining Value To Climb Steadily
Brazil - Mining Industry Value (USDbn) & Growth y-o-y (%)
e/f= BMI estimate/forecast. Source= IBGE, BMI

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