Chinese officials visit Brazil to eye up mining opportunities

A delegation of Chinese government representatives is visiting Brazil to evaluate mining opportunities amid growing international interest in minerals associated with the energy transition.

Brazil’s mines and energy ministry received the delegation headed by Hua Zheng, China’s deputy director of the department of foreign capital and overseas investment at the National Development and Reform Commission (NDRC), to discuss opportunities in the mineral sector on Monday.

“Brazil is a country with enormous potential in strategic minerals for the energy transition. Minister [Alexandre] Silveira always emphasizes that the country is ready to lead the global energy transition and all cooperation for this purpose is very important,” Vitor Saback, secretary of geology, mining and mineral transformation at the ministry, said in a statement.

China is the main client of iron ore companies operating in Brazil. As the appeal of metals associated with the energy transition grows, Brazil wants to attract investor interest in other minerals such as copper, nickel, and lithium. 

Brazil also wants to develop a value-added chain, which has attracted the attention of international players such as China’s BYD.

“Looking ahead, BYD aims to invest across the entire electrification chain, including lithium processing in Brazil, battery production and energy storage,” said Marcello Schneider, institutional director of BYD in Brazil, at a recent event covered by BNamericas.

China is not alone in the race for minerals associated with the energy transition in Brazil.

“Brazil is considered by international participants, despite some persistent political risks, as a safer mining jurisdiction to invest compared to other areas where there are even many warlike conflicts,” mining consultant Pedro Galdi told BNamericas. “China, like other countries, has invested for years in Africa also in the search of minerals associated with the energy transition, but it is much more challenging and risky for investors to put cash in Africa compared to Brazil in terms of geopolitical risks.”

In 2023, US firms invested in Brazil a total of US$610 million in minerals for the energy transition, such as lithium and aluminum, according to Brazil’s export and investment promotion agency ApexBrasil and Amcham Brasil.

Meanwhile, in July, Saudi Arabian government representatives visited Brazil to assess investment opportunities in mining.

Saudi Arabia already has a key investment in Brazil’s mining sector as it recently acquired a 10% stake in Vale Base Metals, secured through Manara Minerals, a joint venture between the Public Investment Fund (PIF) and Ma’aden.

Even with the volatility in the prices of some minerals associated with the energy transition, Brazil is likely to see an increase in investments in the area.

In 2024-28, investments in copper mining are likely to reach US$6.74 billion, a rise of 50.7% versus 2023-27, according to local mining association Ibram.

Investments in nickel are projected to expand 90% to US$4.44bn, those in rare earths to soar 871% to US$1.45bn and in lithium the amount is expected to rise 175% to US$1.19bn, says Ibram.