1910 CHAPTER 1 Mining in the First Republic 1.1 All that glitters is not gold nationalist movements. The workers of Itabira created their own 0217 dialect, guinlagem de camaco (or “monkey language”),2 to avoid being At the end of the 19th century – when prospectors had already understood by their foreign bosses. As time went by, the Itabira Iron given up their search for gold in Minas Gerais and abandoned the Ore Co., which grew up around the Vitória-Minas Railroad, acquired villages in the hills to look for work on the coast – the town of Itabira the profile of the men who ran it. Percival Farquhar – who is said to was little more than Cauê Peak. Cauê was one of those places that have kept the first dollar he earned mounted in a frame next to his nature seems to have sculpted by hand: a mountain that rose up bed, beside a photograph of his parents – was one of them. suddenly from the surrounding plains, forming a unique feature. It Farquhar was a legendary figure, someone whose life seems like is said that during full moons, the mountain used to shine as if lit something from a work of fiction. Some consider him a capitalist up by floodlights hung from the sky. However, as we know, all that genius; others, an opportunist. Born in the city of York, Pennsylvania, glitters is not gold. in the United States, he came to Brazil after working on railroad The word Itabira is of Tupi origin, meaning rock (“ita”) that construction ventures in Latin America (including the unsuccessful shines (“bira”).1 Contrary to the assumptions of the adventurers Madeira-Mamoré adventure in what is now the Brazilian state of who arrived to dig at the foot of Cauê Peak (the shining rock Acre), and he acquired the Itabira Iron Ore Co. in 1919. The paths itself) in search of gold, what made the mountain shine was its taken by the company – especially those that, using the railroad, enormous quantity of iron. It was a reddish iron that spread out its would transport ore to the sea and to fortune – were always color across the landscape, the layers of clay and the rivers in the intimately connected with Farquhar’s trajectory and personality. surrounding area. The color would enter family homes and remain The businessman was the main actor in violent political battles there, ingrained. At the turn of the 20th century, Cauê Peak was and, for better or worse, he was the target of nationalist campaigns mapped as the biggest iron deposit in the world. The news spread concerning the right to extract ore in Brazil. across the planet. The gold prospectors had left Itabira, but now The history of Companhia Vale do Rio Doce (CVRD), established foreign miners started to appear. in 1942 from Farquhar’s Itabira Iron Ore Co., began slightly earlier, The Itabira Iron Ore Company was the first company authorized and is intertwined with the history of mining in Brazil. It is a to prospect for iron in the region. It was the successor to the history of dreams, adventure, politics, wealth, wars, laws and men. Brazilian Hematite Syndicate and, over the course of its existence, A history that, as will become evident, was born in the shiny rocks it witnessed various political upheavals, rises and falls in the of Cauê Peak. international economy, changes in legislation and, above all, 1 - The name Itabira has two different interpretations. According to linguist Theodoro Sampaio, it means rock that rises. However, in the book Voyages dans le provinces de Rio de Janeiro et de Minas Gerais (Paris: Gibret et Darez, 1830, vol. 1, p. 270), by Auguste de Saint-Hilaire, the name Itabira is said to come from the indigenous words “yta” and “bera,” meaning rock that shines. According to Saint-Hilaire, “Therefore, Itabira does not mean higher, sharp rock, as has been suggested.” See Sampaio, Theodoro. O Tupi na geographia nacional. Instituto Historico e Geographico de S. Paulo. São Paulo: Typ. da Casa 2 - The words of “guinlagem de camaco” are made by swapping the first consonant or Eclectica, 1901. Available at: <http://biblio.wdfiles.com/local--files/sampaio-1901-tupi/ group of consonants of the second syllable with the first letter of the first syllable. In this sampaio_1901_tupi.pdf>. way, “linguagem” becomes “guinlagem” (or “guilagem”), and “macaco” becomes “camaco.” Vale Our70 anos History Vale Our History 18 19 Vale Our History Vale Our History Previous page: a panoramic view of the The discovery of new processes for transforming iron town center of Itabira, into steel had immediate consequences. Steel, an alloy of Minas Gerais, in 1899. iron and carbon, and more malleable than cast iron, was essential to the production of machines for new factories and girders for construction 1.2 Mining codes and codes of honor system, the mine owner was the owner of the land on which it was located. This change, expressed in article 72, paragraph 17 of the 20 Understanding the history of mineral exploration in Brazil, more Constitutional Charter, sought to stimulate the free exploitation of 21 than anything else, means understanding the changes in legislation minerals by landowners.5 regulating the sector. Although mining activity has been a part of The minerals people were looking for were no longer gold and the country’s history from the beginning, exclusive laws in the precious stones. Throughout Brazil – and especially in the state of area are relatively recent. Changes started to have real influence Minas Gerais – there were clear signs that the so-called “age of gold” on society at the end of the 19th century, with the proclamation had reached its end. Production of the metal, which in the mid-18th of the Republic. It was the first republican Constitution, enacted century reached 300 metric tons per year, had fallen to a third of this on February 24, 1891, that profoundly altered the subsoil property level less than 100 years afterwards. The number of people living regime. Until then, Brazil had lived under laws largely created soon around the former gold mines was waning.6 However, there were still after the Portuguese royal family arrived in the country. immense resources to be found beneath the ground. The technical and At the start of the colonial period, in 1521, the Ordinances of scientific progress that marked the end of the 19th century, ushering Manuel were enacted, giving the Portuguese Court possession of in what some historians have called the Second Industrial Revolution,7 “seams of gold or any other metal,” and guaranteeing the discoverer opened up new prospects for extracting and using various minerals.8 the right to mine upon payment of one-fifth (the so-called “quinto”) The discovery of new processes for transforming iron into steel of the metals extracted, “after deducting all costs.” As of 1603, the had immediate consequences. Steel, an alloy of iron and carbon, and Ordinances of Manuel were replaced with the Ordinances of Philip, more malleable than cast iron, was essential to the production of which also granted the king ownership of mineral wealth (Book II, machines for new factories and girders for construction. Iron deposits Chapter XXVI, Section 16).3 hitherto abandoned as uneconomic started to be exploited in Europe Soon after independence (but before the Constitution of 1824), and the United States, and steel production grew at an extraordinary the imperial government enacted a law, on October 20, 1823, pace. Used to make railroad tracks, the structures of large buildings, validating “all Portuguese legislation prior to April 21, 1821, including in tunnels and bridges, and in machinery of all kinds, steel – the main the provisions of Book II, Chapter 26, Section 16, Chapter 28 and product made from iron – became a basic industrial raw material.9 Chapter 34, Section 10 of the Ordinances of Philip, which stipulated, among other things, that the king owned all underground mineral 5 - Concerning this subject, see Vivacqua, Attílio, A nova política do sub-solo e o regime legal resources. Accordingly, the imperial period retained the property das minas. system adopted in colonial times, through the Ordinances and the 6 - To consult the censuses, see the IBGE’s library at: <http://biblioteca.ibge.gov. provisions enacted throughout the country by the Law of 1823, br/visualizacao/monografias/GEBIS%20-%20RJ/Recenseamento_do_Brazil_1872/ with the difference that mines and any other subsoil wealth now Provincia%20de%20Minas%20Geraes%201%20Parte.pdf>. In the country’s first census, conducted in 1872, the total population of Ouro Preto was 17,701. constituted the nation’s property”.4 7 - Concerning this subject, see Hobsbawn, Eric. As origens da Revolução Industrial. São One innovation introduced by the 1891 Constitution was the Paulo: Global Editora, 1979; A Era do Capital, 1848-1875. Rio de Janeiro: Paz e Terra, 1996; Da adoption of the United States system of accession. Through this Revolução Industrial inglesa ao imperialismo. Rio de Janeiro: Forense Universitária, 2003; and Lima, Alceu Amoroso. A segunda Revolução Industrial. Rio de Janeiro: Agir, 1960. 8 - See Guimarães, José Epitácio Passos. Epítome da história da mineração. São Paulo: Art Editora, 1981, pp. 102-120. First photograph of men 3 - O regime jurídico da mineração no Brasil. Available at: <www.ufpa.br/naea/pdf.php?id=147>. 9 - See Burns, Edward McNall. História da civilização ocidental. O drama da raça humana. Porto working inside a gold mine, in 4 - Idem. Alegre: Editora Globo, 1948, vol. 2, pp. 674-675. 1888, taken by Marc Ferrez. Vale Our History Vale Our History Interest in the country’s mineral reserves was further shaped by the creation, in 1907, of the Geological and Mineralogical Service of Brazil (SGMB), which was replaced in 1934 by the National Mineral Production Department (DNPM) In turn, technical advances in steelmaking stimulated the Campos and Antônio Olynto dos Santos Pires, all former students mining of coal to make coke, widely used to reduce iron ores in blast of the Mining School.12 furnaces.