The following is a study of one vital sector of the economy in Latin America. To make a long story short, Latin America along with other emerging regions of the globe, maintain a heavy dependence on the export of marketable commodities. In fact, from the cultivation and harvesting of crops to the mining of metals and the extraction of hydrocarbons, the commodities sector in Latin America is estimated to be responsible for close to 40% of economic output currently standing at nearly $ 5 trillion a year. This feature in turn represents a very strong dependence on this sector, which contrasts the makeup of developed economies relying primarily on the manufacture of high-value finished goods, technological as well as scientific innovation and the supply of services including commerce. Likewise, these features, mainly manufacturing, innovation and services, depend on the possession of skills an active labor force has in a country and consequently, human capital is by far the single most important resource a nation needs in order to achieve progress and wellbeing. Nevertheless, political leaders and economists in Latin America are already aware of this fact and realize that substantial higher government spending in the public education system is required in order to combat deficiencies the region has endured since the times of Spanish and Portuguese colonization. Moreover, I’m going to go over countries in Latin America presently mining metals at a high pace in order to stimulate their respective economies. These countries are Mexico, Brazil, Peru and Chile.
Mexico: the mining industry in Mexico is solid and thriving. Currently, the country possesses huge base and precious metals deposits being the single largest net exporter of silver on the planet. In fact, the nation’s largest mining company known as Grupo México S.A.B. de C.V. trades in Mexico and specializes in mining copper after being a conglomerate in its own right being in the process the third largest copper miner worldwide while reporting total consolidated sales that reach over $ 12 billion a year through three different mining operations and two side businesses. Likewise, the biggest refiner of silver globally operating out of Mexico but registered, domiciled and trading in London is known as Fresnillo PLC. The latter is controlled by Industrias Peñoles S.A.B. de C.V., a mining concern listed in Mexico holding mining operations in copper, lead and zinc throughout the entire Mexican territory in addition to silver mineral rights through Fresnillo. Similarly, prominent Mexican tycoon Alberto Baillères González controls Industrias Peñoles whereas Grupo México is controlled by shrewd Mexican magnate Germán Larrea Mota-Velasco after holding a majority shareholding shared along with his mother Sara Mota de Larrea. Moreover, Mexican goliath Carlos Slim Helú is also active in this sector nationally through control of a publicly-traded mining concern in Mexico known as Minera Frisco S.A.B. de C.V. The latter mines precious metals including gold and silver as well as copper, lead and zinc. In addition, Grupo México consolidated the railroad sector in Mexico over a decade ago after purchasing Ferrosur S.A. de C.V. from Minera Frisco and then merging it with its own railway company known as Ferromex S.A. de C.V. while combining the entities under its umbrella and publicly-traded subsidiary known today as Grupo México Transportes S.A.B. de C.V. The two railroads, however, continue to operate independently. Other prominent miners include a listed silver mining operation known as Minera El Pilón S.A. de C.V. and Minera Autlán S.A.B. de C.V. which focuses on ferroalloys while trading in Mexico.
Brazil: the country has exorbitant iron ore and nickel deposits currently being the second largest net exporter of iron ore on the planet after Australia. As a consequence, major miners focused on mining iron ore primarily include Mineração J. Mendes Limited, World Mineral Resources Participações S.A. and VALE S.A. The first company just mentioned is controlled by local businessman José Mendes Nogueira while the second one mentioned is owned in its entirety by prominent Brazilian entrepreneur and geologist João Carlos Cavalcanti. Moreover, the publicly-traded and state-controlled VALE is the single largest miner of iron ore worldwide exporting substantial shipments of the ferrous metal to fast growing economies like China while reporting sales that reach over $ 30 billion a year. Similarly, VALE is also the largest miner of nickel on the planet. In addition, the Brazilian blue chip and national champion trades as an ADR on the NYSE under the ticker symbol (VALE) while controlling its own railroad under an affiliate known as VLI Multimodal S.A. Likewise, former Brazilian billionaire Eike Batista had solid and profitable business interests mining iron ore throughout the nation before selling them to meet debt repayments while under liquidation proceedings. To conclude, Brazil possesses rich gold and base metals deposits as well including bauxite, nickel, lead and zinc. In fact, the Brazilian privately-held conglomerate known as Votorantim Industrial S.A. operates a wholly-owned subsidiary engaging in the mining of nickel, lead and zinc known as Votorantim Metais S.A. while reporting sales that currently reach $ 1 billion a year.
Peru: the country has enormous mineral deposits including base metals, precious metals, tin and coal. Currently, Peru is the second largest net exporter of copper worldwide after Chile and the second largest net exporter of silver on the planet trailing Mexico only. Peru is also the second largest net exporter of zinc globally and the third largest net exporter of lead worldwide as well including an important participation in the tin mining business. Moreover, two publicly-traded companies mining copper solely while controlled by foreign multinationals representing foreign direct investments include Southern Copper Corporation and Sociedad Minera Cerro Verde S.A.A. The former is controlled by Grupo Mexico S.A.B. de C.V. whereas the latter is controlled by Freeport-McMoRan Copper & Gold Corporation. Likewise, other players operating nationally include two miners trading in Peru controlled by Inversiones Breca S.A., the privately-held holding company belonging to the wealthiest clan in the country known as the Brescia family. Accordingly, the two miners controlled by the clan include Compañía Minera Raura S.A., an operation that mines copper, silver, zinc, and lead as well as the third largest tin mining enterprise worldwide trading in Peru known as Minsur S.A. with annual sales exceeding $ 1 billion. In addition, other miners include Volcán Compañía Minera S.A.A., a miner listed in Peru focused on lead, zinc, copper and silver as well as the well-established company trading in Peru known as Compañía de Minas Buenaventura S.A.A. The latter is a prominent player controlled by the brothers Roque and Raúl Benavides Ganoza mining gold, silver, lead, zinc and coal owning rights to several sites while reporting close to $ 2 billion a year in sales. By the same token, another prominent player specialized in precious metals including gold and silver owning rights to several mines located in Chile and Argentina besides Peru but registered, domiciled and trading in London is Hochschild Mining PLC. The latter is controlled by prominent Peruvian billionaire Eduardo Hochschild, a grandnephew himself of the company’s founder. Similarly, Votorantim Industrial has a presence in Peru as well through control of a small mining concern producing copper, lead and zinc known as Compañía Minera Atacocha S.A.A. There is also a copper mining operation worth mentioning holding rights to one single site in Peru known as Marcobre S.A.C. owned jointly by Minsur S.A. and Alxar Minería S.A. from Chile.
Chile: mining is crucial for the economic development of the country. Accordingly, Chile possesses rich copper and lithium deposits along the narrow Atacama Desert. Currently, copper mining alone in Chile accounts for 60% of exports and 20% of GDP. In fact, the national copper mining company completely owned by the Chilean government known as CODELCO is today the largest copper miner globally after reporting sales that reach over $ 20 billion a year. Likewise, this company owns the largest open pit copper mine by excavated volume worldwide known as “Chuquicamata”. Moreover, the Chilean state shares the copper mining sector with domestic players fully as well as foreign multinationals as long as CODELCO participates in control of the mining ventures foreigners participate in except for the privately-held Chilean mining concession known as Minera Escondida Limitada which is totally owned by foreigners and controlled by the powerful dual-domiciled listed Anglo-Australian miner known as BHP Group PLC-BHP Group Limited. Consequently, other important players in the Chilean copper mining sector include Antofagasta PLC, Alxar Minería S.A., Sociedad Contractual Minera El Abra S.A. and the previously mentioned Minera Escondida Limitada. Antofagasta reports around $ 5 billion a year in sales and is registered, domiciled and listed in London while being controlled by the wealthiest clan in the country known as the Luksic family. Alxar Minería mines copper as well as precious metals including gold and silver and belongs in its entirety to national champion Empresas Copec S.A., the prominent publicly-traded conglomerate indirectly controlled by the Angelini family through control of the publicly-traded holding company in Chile known as AntarChile S.A. Sociedad Contractual Minera El Abra, on the other hand, is a privately-held joint venture mining copper at one single site and controlled by Freeport-McMoRan Copper & Gold Corporation while letting CODELCO retain a 49% economic interest in the business. Moreover, Minera Escondida operates two copper mines including the single largest producer of copper in terms of output today located in the mineral-rich Atacama Desert. In addition, Empresas Copec controls a coal mining operation in Southern Chile known as Mina Invierno S.A. Similarly, the lithium mining segment in Chile is dominated by a vertically integrated operation holding lithium mineral rights as well as engaged in the production of fertilizers known as Sociedad Química y Minera the Chile S.A. In fact, the company has doubled in stock market value since 2013 after trading in Chile and here in the US as an ADR on the NYSE under the ticker symbol (SQM). Furthermore, the company is controlled by Chilean billionaire Julio Ponce Lerou whose handpicked management has designed astute business plans anticipating excellent growth prospects in the future for the top line, bottom line and stock price of the entity. The control of the latter, exercised by tycoon Julio Ponce Lerou, is made through a listed holding company in Chile known as Sociedad de Inversiones Pampa Calichera S.A.