Brazil’s tailings tragedy may hasten regulatory reform

Subject

Waste management in the mining sector.

Significance

The tragedy at Brazilian Vale’s Brumadinho mine on January 25 cost the lives of over 150 people, with nearly 200 still missing. The toll is much heavier than in 2015 when a similar dam with iron ore tailings burst at Samarco’s Bento Rodrigues operations. In both cases, heavy mud was released, destroying everything in its path. The disasters add to a long list of tailings failures that have plagued the sector since the birth of modern mining.

Impacts

• Shut since 2018 after a leakage, Anglo American’s Minas Rio operation uses wet tailings and may suffer the effects of regulatory changes.
• The fallout from the Brumadinho tragedy may delay the reopening of Samarco’s operations, which have been closed since 2015.
• Vale will lose some 11 mt per year of iron pellet output, putting pressure on global markets as there are no perfect substitutes.
• The loss of production capacity in Minas Gerais means that more high-grade material will be blended into iron ore product shipped to Asia.