Ana Sanches, top executive in Brazil for Anglo American Plc, says the nation should avoid picking sides in the global race for critical minerals and seek to supply countries across geopolitical blocs. "We have to negotiate with everyone. There's no reason for us to choose a side," she said in an interview Monday, a day after leftist President Luiz Inácio Lula da Silva won reelection as head of Latin America's largest economy.
Brazil holds one of the world's largest reserves of rare earths, used in electric vehicles, wind turbines and drones, second only to China. Lula will be challenged to balance ties with China, the country's biggest trading partner, and the US, which is seeking alternative supplies of critical minerals to reduce its reliance on Beijing.
Sanches urged Brazil to move quickly to set clear rules for its new critical-minerals policy, which gives a government council special powers to approve mining deals and supply agreements. The policy has yet to be enforced. "We just need clarity on what that means and how it will be implemented," she said, adding that fighting illegal mining, expanding geological mapping and making permitting more predictable are also key for the sector.
Sanches also said Brazil should treat high-grade iron ore as a critical mineral, since scarce premium grades will play a growing role in decarbonizing steel production. Anglo's Minas-Rio operation, which produces ore with about 67% iron content, is not planning production cuts despite a 12% year-over-year drop in third-quarter realized prices, and the company expects shipping rates to retreat.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing