Horizonte begins construction of Araguia nickel mine in Brazil

Horizonte Minerals has begun construction of its Araguaia nickel mine in northern Brazil, which will produce 29,000 tonnes of battery metal a year, mainly for the stainless steel market.

The project, which will take about two years to complete, will initially produce 14,500 tonnes of nickel per year. Construction includes an open pit and a processing plant that is expected to produce ferronickel within 28 years.

Araguaia is considered a key project in the diversification of Brazil's mining industry, which is centered on iron ore.

Horizonte is also advancing a feasibility study for the Vermelho nickel-cobalt project, also in the state of Pará. Vermelho expects to produce about 15,000 tonnes of nickel and 6,000 tonnes of cobalt annually in the first phase.

Over the 38-year mine life, Vermelho's capacity could increase to 24,000 tonnes of nickel per year.

Brazil, with estimated nickel reserves of 16 million tonnes, is currently the world's eighth-largest nickel producer, with production of 100,000 tonnes in 2021.

Global nickel use surged 16.2% last year, driven by soaring demand from stainless steel and battery end-use industries. The result is a nickel supply shortfall of 168,000 tonnes, the largest production shortfall in at least a decade, according to the latest statistics on the market from the International Nickel Research Organization.