Political turbulence, weak commodity prices and a decrease in the value of the local currency have bought Brazil’s economy to a crisis point. 2015 saw iron prices drop to a five year low of $75 per ton. The Bento Rodrigues dam disaster of November 2015 brought global scrutiny to the country’s mining sector. And, the impeachment of Dilma Rouseff was the latest episode of a long-lasting political crisis that has not helped attract much needed investments in areas such as infrastructure.

However, investors cannot afford to take Brazil out of their priority list of mining destinations, and will be looking for opportunities that the current set of challenges present. The fallout of the dam disaster will instil a renewed vigor in the sector as companies push to demonstrate commitment to corporate social responsibility. A hugely devalued currency and financially stretched companies means that bargains can be discovered and a new mining code is in process. As commodity prices recover, Brazil should reposition itself as a sound destination for long-term investment.