International demand increases the number of mining licenses in Brazil

RIO DE JANEIRO, BRAZIL – In 2021, the number of authorizations for mining company operations exploded in Brazil. The mining activity has gained strength in recent years, along with growing revenues. The sector accumulated revenues of R$209 billion (US$38 billion) in 2020. In 2021, the revenue rose to R$339 billion.

Rising production also means more taxes collected — a growth of more than 63% in the last two years.

Professor Daniel Neri from the Federal Institute of Minas Gerais says that the demand for the product in countries like China, the commodity’s price, and the advance of technology explain the greater interest of companies in exploiting the ore.

“The technological issue increases productivity, increases the capacity to extract ores, including those with low iron content. This leads to an increase in the amount of waste, but also to the use of ore in regions that were not even considered mining regions,” says Daniel Neri.

In 2021, the National Mining Agency (ANM) granted 825 licenses. In 2020, there were 594. The numbers have been growing since 2017.

Minas Gerais, in 2021, was one of the states with more mining licenses issued in Brazil: 103. Only Paraná had more authorizations: 146. It is easy to notice where the sector’s activities take place. Serra do Curral, in Belo Horizonte: on one side, the preserved mountain, on the other, a very different scenario. Extensive excavations are needed to get to the ore, and there are impacts on the vegetation and the underground water reserve in the region.

That is why specialists reinforce that this important economic activity needs to be closely monitored by inspection. Professor Bruno Milanez, from the Federal University of Juiz de Fora, sees with concern the growth of mining license concessions in Brazil.

He recalls the tragedies – such as the bursting of dams in Mariana and Brumadinho – which left hundreds of dead and devastated the environment in Minas Gerais. Enforcement is weak and needs to be strengthened, according to the professor.

“It would be urgent, right now, to have a strengthening of the regulatory and control agencies, both the ANM, in this specific case of dams, of safety, and also the environmental agencies, usually state ones, which are also very precarious, very empty and rarely able to effectively monitor the environmental impacts and effects that mining operations end up causing. We need to strengthen the inspection capacity in the country if we really want to prevent new disasters from happening”, says Bruno Milanez, a dam specialist.

The Brazilian Mining Institute explains that, for mining to take place, it is necessary to have the mining permit issued by the Ministry of Mines and Energy after analysis by the ANM. The environmental licenses are held by the state secretariats and federal agencies, depending on the location of the activity. In some cases, Ibama’s authorization is also required.

Ibram, the Brazilian Mining Institute, represents the mining companies and says that the inspection is very welcome.

“The sector wants to be inspected more and more to act with safety, guaranteeing a safe, efficient operation, respecting the environment, respecting the communities, so that everyone has tranquility, that the sector is responding to this demand,” says Flávio Ottoni Penido, president-director of Ibram.

The National Mining Agency stated that it only authorizes exploitation of the areas after environmental licensing and that the agency strictly follows Brazilian law.