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Bureau of Mines / Minerals yearbook area reports: international 1978-79
Year 1978-79, Volume 3 (1978-1979)

Martino, Orlando
Brazil,   pp. 167-190 PDF (2.8 MB)


Page 167

  167The Mineral Industry of 
Brazil 
By Orlando Martino1 
 Brazil's economy in real terms grew by 6.3% in 1978 and 6.5% in 1979 compared
with the 4.7% rate in 1977. The gross domestic product (GDP) in current prices
increased to $191 billion2. in 1978 and an estimated $213 billion in 1979.
The rate of inflation in 1978 was 41%, the level of recent years, but increased
to 77% in 1979, the highest rate since 1964. 
 The Government was developing policies to reduce the trade deficit that
surged in 1979 by limiting imports and to reduce inflation by restraining
the spending by Brazil's many public companies. At yearend 1979, it was not
apparent how these policies would affect the priorities and investment programs
in the mineral sector. 
 In the 5-year period ending in 1978, Brazil's mineral industry experienced
strong growth, increasing at an average of 26% per year. In 1978 the value
of mineral output increased 38% to $4.0 billion compared with $2.9 billion
in 1977. The value of mineral output is estimated at $4.8 billion for 1979.
 The contribution of Brazil's mineral industry to the national economy is
estimated at about 2% GDP but the industry is more important in Brazil's
exports. Exports of commodities with mineral origin accounted for 18% of
total export value in 1978. The value of iron ore exports alone in 1978 was
8% of the total. 
 Brazil in 1978-79 continued as an iznportant producer and exporter of iron
ore, manganese, pyrochlore concentrate and ferrocolumbium, electronic-grade
quartz crystal, and gem stones. The leading mineral commodities produced
in terms of value were petroleum, iron ore, crushed stone, limestone, coal,
marine salt, manganese, bauxite, gold, pyrochiore, tin, and natural gas.
Brazil's metallic and nonmetallic in- 
dustries comprise about 116 companies with total assets of about $3.6 billion.
In terms of capital, the dominant mineral company was Companhia Vale do Rio
Doce (CVRD), a corporation under the jurisidiction of the Ministry of Mines
and Energy, followed by Samarco Mineraçao S/A, Amazonia Mmeração
S/A, Mineraçao Rio do Norte S/A, and Mineração
Morro
Velho S/A. The mineral fuels sector was dominated by the state-owned oil
company Petroleo Brasileiro 
S/A (PETROBRAS). 
 It is estimated that 80% of Brazil's mineral industry is controlled by the
state; 15%, by foreign companies; and only 5%, by private domestic companies.
The Government was studying measures to increase the participation of Brazil's
private sector in its mineral development. Toward this end, the Ministry
of Mines and Energy reactivated in April 1979 the Conselho Superior de Mineraçao
created in 1965. It was decided that no state company could request an exploration
license (other than for petroleurn or uranium under monopoly control) without
having consulted private companies. It was also decided to restrict the future
operations of CVRD. In the Serrados Carajas region, for example, CVRD would
be required to limit itself to iron ore exploration while private initiative
would be applied in the exploration of copper, gold, lead, zinc, and manganese.
As another example, the Government was considering reducing CVRD's 60% ownership
in the Valesul aluminum project to 40%. The Ministry of Mines and Energy
also announced that fertilizers would be the next group in which state participation
would be reduced. 
 As a first step in reducing state ownership of industry, the Brazilian National


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