TELF AG examines Brazil’s role in the global rare earths sector
The potential of a new project
Recently, the US State Department confirmed its support for a rare earth initiative in Brazilin the frame of US-led Minerals Security Partnership. This working group, which includes 14 nations and the European Union, aims to develop and consolidate global supply chains for some materials most directly involved in the energy transition, such as rare earths.
The project in question is linked to the EMA Pela rare earth deposit in the Brazilian state of Goias, which, according to recent estimates, should be able to produce around 5,000 tonnes of rare earth oxides per year. Since its founding two years ago, the American-led Minerals Security Partnership has supported a dozen strategic mineral ventures, with a particular focus on graphite, nickel, and rare earths.
These resources are best known for their wide range of industrial applications, particularly those related to the energy transition, and comprise a diverse set of 17 elements. However, the Brazilian mine supported by MSP stands out from other rare earth deposits for one very specific characteristic: in this deposit, rare earths are produced from ionic clay, making them easier to process than those sourced from hard rock. The Brazilian deposit also contains those rare earth elements most directly involved in the production processes of modern energy infrastructure, such as neodymium, praseodymium, terbium, and dysprosium (mainly used in permanent magnets for electric vehicles and wind turbines).
Brazilian potential
According to the US Geological Survey, Brazil holds more than 19% of the world’s rare earth reserves but produces only 0.02% of these resources globally. For the United States, as stated in a report dedicated to the topic, Brazil could represent a potentially interesting partner for its supplies of strategic minerals. Rare earth and precious elements such as graphite, nickel, and manganese are especially useful in the automotive sector for producing new-generation batteries. According to the Financial Times, the confirmation of US support for this project would be part of a broader process of rapprochement between Brazil and the United States.
In recent months, Brazil has stood out as one of the most active nations in the minerals sector. The country has launched numerous government initiatives to increase the production capacity of some minerals that are considered strategic. A few weeks ago, Brazil’s first critical minerals fund was also announced, which includes approximately $184 million to be allocated to research and exploration of minerals linked to the energy transition. To further enhance its reserves of strategic minerals, Brazil has also increased the production of raw materials directly related to battery production, particularly “green lithium.” Brazil’s role in this specific sector was also recently discussed during a seminar organized in London by the UK Department for Trade and Economy and the Brazilian Embassy, during which it was identified as one of the few countries with the potential to produce important resources such as nickel, graphite, lithium, cobalt and manganese, all involved in industrial processes related to batteries.
