CMIN3 CSN Mineração

CSN Mineração S.A. is a Brazilian company focused on the production and commercialization of iron ore, with common shares traded on B3 under the ticker CMIN3. Incorporated in 2007 under the name Congonhas Minérios S.A., as a subsidiary of Companhia Siderúrgica Nacional (CSN), the company consolidated its current structure starting in 2015, when CSN’s iron ore and logistics businesses were combined with those of its then-controlled subsidiary Namisa, in partnership with an Asian consortium formed by major steelmakers. The operating origins of the business, however, date back to the beginning of exploitation of the Casa de Pedra mine in 1913, which gives CSN Mineração a century-long history in the iron ore mining industry in Brazil. In February 2021, the company carried out its initial public offering of shares, resulting in a more dispersed shareholder base on the Brazilian stock exchange, while keeping CSN as a relevant controlling shareholder.

CSN Mineração’s main activity is the mining, processing, and commercialization of high-grade iron ore, with an integrated operation that encompasses mine, railway, and port. The company develops mineral deposits, conducts geological research, open-pit extraction, processing in beneficiation plants, and shipment through its own and affiliated logistics assets. Its economic focus is on the production of lump ore, sinter feed, and pellet feed, which are essential inputs for the steel industry. In addition to mining, the company’s corporate purpose includes port infrastructure operations, power generation to primarily supply its mining operations, and equity interests in other companies related to its value chain, such as rail logistics and hydroelectric generation.

CSN Mineração’s core operating assets are the Casa de Pedra and Engenho mines, located in the Iron Quadrangle region in Minas Gerais, one of the richest iron ore regions in the world. Casa de Pedra is one of the oldest mines in operation in the country and one of the largest in capacity, with open-pit mining and a production track record dating back to 1913. The Engenho mine, in operation since 1950, is also an open-pit mine and its ore is processed both at the Pires beneficiation plant and at the Casa de Pedra unit itself. The production process involves primary, secondary, and tertiary crushing, particle size classification, flotation concentration stages for pellet feed production, and subsequent filtration. The company has an installed capacity of about 33 million tons per year of iron ore in its plants (central plant and dry plants), and supplements its volume with third-party purchases to reach higher annual sales levels.

CSN Mineração’s product portfolio consists mainly of lump ore, sinter feed, and pellet feed, with characteristics suited to the needs of different steelmaking clients. Lump ore has coarser particle size and can be fed directly into blast furnaces without the need for agglomeration. Sinter feed, with intermediate particle size, is used in sintering processes before being applied in ore reduction at steel mills. Pellet feed, with very fine particle size, is intended for pellet production after an agglomeration process. This combination of products allows the company to serve both integrated steelmakers and mills with different production routes, in Brazil and abroad. In 2024, CSN Mineração sold more than 42 million tons of iron ore, with most of it destined for the export market and a relevant share supplied to CSN’s Presidente Vargas steelworks in Volta Redonda (RJ).

Integrated logistics is an essential component of CSN Mineração’s business model. The company holds the right to operate TECAR, a coal and ore terminal located at the Port of Itaguaí (RJ), leased until 2047, which is responsible for all of the company’s iron ore shipments to the overseas market. TECAR has annual iron ore loading capacity and also handles the unloading of reductants such as coal and coke, used mainly by the CSN group. The flow of production from Minas Gerais to the port is carried out through the rail network of MRS Logística S.A., an affiliate in which CSN Mineração holds an 18.74% interest. MRS connects the Iron Quadrangle to the Port of Itaguaí and to the Presidente Vargas steelworks, transporting all the iron ore produced by CSN Mineração, in addition to the coal and coke imported through TECAR.

CSN Mineração’s markets are concentrated in supplying iron ore to the overseas market, with an emphasis on clients in Asia and Europe, in addition to serving the Brazilian steel industry. The company is among the largest iron ore exporters in Brazil, operating in a sector strongly influenced by the global steel industry dynamics, especially Chinese demand. Production is primarily destined for export, with significant contracts with trading companies and international steelmakers, such as substantial volumes negotiated with Glencore International AG and Prosperity Steel United, which have represented a significant share of annual revenue. The company also supplies the domestic steel chain by providing ore to CSN, integrating with flat steel production in the country.

On the regulatory front, CSN Mineração’s activities are subject to Brazil’s mining legal framework, governed by the Mining Code and related regulations. Mineral exploration and extraction depend on permits and concessions granted by the Federal Government, with oversight exercised by the National Mining Agency (ANM). In addition, TECAR’s operation is subject to a port lease agreement, under the supervision of the National Secretariat of Ports and the National Agency for Waterway Transportation (ANTAQ). In power generation, through its subsidiary Companhia Energética Chapecó (CEC) and the Quebra-Queixo Hydroelectric Plant, the company complies with the electricity generation concession rules defined by the National Electric Energy Agency (ANEEL), with a concession contract in force until 2040.

From an environmental, social, and governance perspective, CSN Mineração highlights initiatives related to tailings management and operational safety. The company has adopted tailings filtration and dry stacking technology since 2020, which reduces reliance on conventional dams and aligns with the pursuit of greater control over environmental risks in mining. There have been substantial investments in modernizing tailings disposal structures, decommissioning dams, and implementing dry stacking, integrating the beneficiation process with the mitigation of environmental impacts. In terms of governance, the 2021 IPO and debenture issuances strengthened its access to the capital markets, with disclosure of financial and operational information to investors, while the shareholder structure keeps CSN and the Asian consortium as strategic controlling blocs in the company’s management.

In addition to mining and logistics, CSN Mineração also began operating in power generation through the acquisition of all the shares of Companhia Energética Chapecó, which operates the Quebra-Queixo Generation Plant on the Chapecó River in Santa Catarina. This hydroelectric plant operates as an independent power producer, primarily focused on meeting the energy needs of the mining operations. Diversification into power assets reinforces the vertical integration of the business, ensuring greater supply predictability and contributing to cost competitiveness in iron ore production. With this asset base – high-grade mines, beneficiation plants, associated rail infrastructure, dedicated port terminal, and its own power generation – CSN Mineração consolidates an integrated model for iron ore production and export, reflected in the economic and financial performance presented to the market through its CMIN3 shares traded on B3.