Despite its remarkable potential, the Brazilian mining industry, Latin America’s largest, is not fully represented in the capital markets.
Out of many companies, only four main mining entities, Aura Minerals, CBA, CSN Mining, and Vale, have listings on B3.
Additionally, two other companies, Usiminas and Gerdau, engage in iron ore production, but their main operations focus on steel production.
Guillaume Légaré, Head of the Toronto Stock Exchange & TSX Venture Exchange in Latin America, indicates that this current status doesn’t reflect Brazil’s abundant mineral potential.
Operating from São Paulo, Légaré’s mission involves luring Brazilian mining companies and foreign companies with local projects to list on the Toronto Stock Exchange (TSX) and Toronto Stock Exchange Venture (TSXV), both based in Toronto, Canada.
Légaré primarily focuses on ‘junior companies’, or small-scale miners, as well as small-to-medium companies boasting well-structured management.
He explains that the TSX is an access point for companies with solid management teams and confirmed mineral reserves.
Furthermore, Légaré stresses that Brazil has gained even more appeal for minerals associated with the energy transition and aims to attract these miners to the TSX.
Raul Jungmann, the president of the Brazilian Mining Institute (Ibram), has also voiced concerns about the Brazilian mining sector’s limited presence in capital markets, particularly on B3.
He advocates for demolishing this barrier to allow the sector to raise more funds for various projects.
Among the recent companies operating in Brazil that listed on the Toronto Stock Exchange is Bravo Mining, a Canadian company.
In mid-2022, Bravo initiated a project to explore platinum, nickel, and gold in Pará. The project, still in its early stages, is located in the Carajás region, with areas previously acquired from Vale.
As of April, 40 mining companies were operating in Brazil listed on both exchanges.
Among them is Aura Minerals, which produces gold in Brazil and listed on B3 shortly after its capital opening in Toronto.
Another notable company is Largo, a vanadium extractor and processor based in Bahia.
In the TSXV, Canadian-based Sigma Lithiun stands out with a significant lithium production project in Minas Gerais’ Jequitinhonha Valley.
Sigma, led by Brazilian Ana Cristina Cabral, made its debut on the Toronto stock exchange in 2018, raising US$20 million and later listed on the Nasdaq in 2021.
Sigma’s market value is around US$4 billion, reflecting the share value traded on Nasdaq. On the TSXV, the value rises to 5.8 billion Canadian dollars.
Despite Brazil’s abundant potential, the country is not the leader in the region, trailing Mexico, Peru, Argentina, and Chile in the number of mining companies.
Yet, the sector’s potential remains untapped, with Brazilian mining projects raising US$420 million on the TSX and TSXV last year.
As the Canadian stock exchange’s MiG Report highlights, 14 out of 97 global companies listed on the TSX and TSXV last year belong to the mining sector, raising a total of US$5.3 billion.
With information from Valor