How the global EV boom can benefit Brazil’s mining sector

Brazil’s mining sector posted lukewarm results at the beginning of 2022. Both production and sales were down significantly in Q1 compared with one year prior, due in part to maintenance on a number of operation units across the country, the effects of strong rains in the state of Minas Gerais, and a sharp decrease in Chinese imports.

Rising costs, ongoing Covid lockdowns in China, and economic uncertainty in Europe continue to cast a cloud over the mining sector’s prospects. 

But there could be one bright spot on the horizon: growing global demand for the minerals used to make electric vehicle (EV) batteries, illustrated by a recently confirmed deal between EV-maker Tesla and Brazilian mining giant Vale. Following weeks of rumors about “secret deals” between the two companies, Vale confirmed on May 6 that it had reached a long-term agreement to supply Tesla with Class 1 nickel.

In a statement, the mining company said that it aims to deliver 30 to 40 percent of its Class 1 nickel sales to the “fast-growing” EV industry.

Demand for battery-related minerals explodes

Tesla’s partnership with Vale is the EV-maker’s latest move to source in-demand metals directly from mining companies, bypassing suppliers. With Tesla leading the way, the auto...