What Brazil's Political Crisis Could Mean for the Brazilian Mining Industry

Demonstration in Brasília outside of the National Congress Building.

If you've been paying any attention at all to global news reports, then you're aware that for some time, there's been trouble brewing in Brazil. To summarize an excellent article appearing in CNN Money, the unrest is due largely to dissatisfaction with rampant political corruption, a tanking economy, and wildly soaring stock market values.

Throughout the month of March, while rumors of President Dilma Rousseff's impeachment flew, demonstrators took to the streets in many cities across the country, with huge movements in São Paulo even leading to clashes between police and anti-government protesters.

What does all of this mean for the Brazilian mining industry?

In the short term, nothing good. Anything that disrupts the smooth operation of a country negatively affects the country's industries, and the mining industry is no exception to this. If the protests continue, Brazil may struggle to retain even its current (questionable) level of economic stability. No one would desire to see this situation develop.

On the other hand, these protests could benefit Brazilian mining in the long run. If the protests lead to a national movement to abolish corruption improve the national economic policies and general governance, then Brazil's tanking economy has a chance of turning around, benefiting all industries - including mining. However, just like an ultra-class haul truck, national economies the size of Brazil's don't turn on a dime. Any turnaround in the economic fortunes of Brazil will probably take a couple of years at the very least.

As you know, we've been following this story as it has developed throughout March, and we plan to follow it to its conclusion. If you have questions, comments, or concerns, feel free to sound off the comments.

As always, remember that we carry a full line of OTR tires for all of your mining needs. Feel free to contact us for information on our product lines or to consult on our current deals.

Image credit: By Agência Brasil CC BY 2.0, via Wikimedia Commons

The post What Brazil’s Political Crisis Could Mean for the Brazilian Mining Industry appeared first on BuyBigTires.com.