Thyssenkrupp is preparing to supply the growing demand of Brazil's large mining companies with local manufacturing facilities, as major players look to expand production
After the Bauer Group, specialized in solutions and machinery for construction and mining, expressed interest in investing in the mining sector in Brazil, as the country seeks solutions to problems related to tailings dams, now the German multinational Thyssenkrupp has decided to manufacture parts and equipment for machines for the national mining sector.
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The company, which has two service centers in Brazil, one in Minas Gerais and the other in Pará, is going to modernize the units to produce machine parts and equipment, seeking greater competitiveness in cost and logistics.
“We are going to take advantage of our service centers to manufacture parts of machinery and equipment with high added value, which were imported, creating cost reduction and faster delivery times”, said Paulo Alvarenga, president of operations for South America at Thyssenkrupp, for the Valor Econômico newspaper.
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“Eighty percent of Brazilian iron ore production uses Thyssenkrupp equipment,” said Alvarenga. Currently, all Thyssenkrupp equipment sold in Brazil came from its facilities in the German city of Ennigerloh, a center specializing in mining.
In August, Bauer representatives met with Brazilian government officials to express interest in investing in the mining sector. The company has presented a plan to invest €20 billion (US$23,7 billion) in Brazil over the next few years in the areas of mining and tailings dam infrastructure, primarily with a focus on dam protection, containment and repairs.
Mining in Brazil: More production ahead
Brazil's mining sector, which is highly concentrated in iron ore, has been hit by two major tailings dam failures in recent years and has suffered from the effects of COVID-19. However, big players are preparing to expand production.
The country's biggest miner, Vale, said last week that it plans to expand annual iron ore production gradually to 400-450Mt in the coming years. This year, the mining company expects to produce between 310Mt and 330Mt.
Brazilian steelmaker CSN, meanwhile, announced plans to carry out an IPO of its mining unit CSN Mineração to finance its expansion plan.
CSN Mineração, which is the second largest iron ore producer in Brazil, plans to expand production capacity to 108Mt by 2033, compared to 33Mt today.