BYD, a leading Chinese electric vehicle manufacturer, made a significant move in 2023 by acquiring mining rights to two parcels of land in a lithium-rich area of Brazil. This strategic decision marks BYD’s entry into the mining sector in Brazil, its largest market outside of China. The acquisition was carried out by BYD subsidiary Exploracao Mineral do Brasil, which was established in May of the same year, according to a recent report by Reuters.
The two plots of land are situated in the Jequitinhonha Valley, known as Brazil’s Lithium Valley, in the state of Minas Gerais. The mineral rights cover a total area of 852 hectares (8.5 square kilometers) in the town of Coronel Murta, positioning BYD in a prime location for lithium extraction.
This move aligns with BYD’s broader strategy in Brazil, as the company recently announced plans to establish a large manufacturing site complex consisting of three plants in the country. The industrial complex includes facilities for electric bus and truck chassis production, new energy passenger car manufacturing, and a processing plant for lithium iron phosphate (LFP) battery materials. Construction on the site began in March 2024, signaling BYD’s commitment to expanding its presence in Brazil.
In addition to securing mining rights, BYD has been exploring partnerships in the lithium sector. In January of last year, the company was reportedly in discussions with Brazilian lithium producer Sigma Lithium regarding a potential supply agreement. Lithium is a crucial raw material for battery production, making these negotiations essential for BYD’s battery supply chain.
The acquisition of mining rights in Brazil comes at a time of fluctuating lithium prices in the global market. While prices spiked in 2022, they have since declined, underscoring the importance of securing a stable supply of lithium for EV battery production. BYD’s foray into lithium mining positions the company to strengthen its supply chain and ensure a reliable source of raw materials for its electric vehicles.
Looking ahead, BYD’s expansion into the mining sector in Brazil reflects the company’s long-term vision for sustainable growth and innovation in the electric vehicle industry. By strategically investing in lithium resources and expanding its manufacturing capabilities, BYD is poised to solidify its position as a key player in the global EV market.
