Brazil announces major iron deposit discovery in Matto Grosso

The announcement was done by Matto Grosso governor Silval Barbosa.

If confirmed it would be bigger than the country's massive Carajas iron ore mine in Para state, which the national mining department estimates at 2 billion to 3 billion tonnes of ore. Brazilian mining giant Vale, which controls Carajas, says it holds 7 billion tonnes of ore.

Although Carajas is smaller than the Mato Grosso deposit, it has relatively higher ore grades of 67% iron content. The new deposits cover an area of 43 square kilometres next to the Bolivian border.

The Mato Grosso state government named the concession holder of the deposit as GME4 of Global Mine Exploration.

The logistics of developing the mine will be challenging. The centre-west state of Mato Grosso is deep in the interior of Brazil and far from any ports. A railway or a river barge system would need to be developed to get any eventual production to the international market.

Barbosa said that the state would help finance the viability of exploiting the project.

China has been the main buyer of the 23 million to 25 million tonnes of iron ore that Brazil exports monthly, with Vale accounting for the majority of those shipments. Vale which was privatized in 1997 is the world’s leading producer and exporter of iron ore in the world.

In the first seven months of this year Brazil exported iron ore and concentrates totalling 12.35 billion US dollars equivalent to 11.5% of the country’s exports. China absorbed over 5 billion US dollars.