In Minaçu, in the northern part of the Brazilian state of Goiás, the landscape bears the scars of an earlier mineral rush. For decades, the town depended on the Cana Brava asbestos mine, whose prosperity was inseparable from lethal illnesses and a long history of environmental damage. Now Minaçu has been recruited into another promised future. At the Pela Ema mine, Serra Verde extracts rare-earth elements required for electric motors, wind turbines, advanced electronics, and weapons systems. The mineral has changed, but the danger is that the old structure of dependency will remain intact.
Brazil possesses approximately 23 percent of the world’s known rare-earth reserves, second only to China. Yet it accounts for barely 1 percent of production and lacks an integrated industrial chain capable of separating rare-earth elements, converting them into metals and alloys, and manufacturing permanent magnets. The country owns the geological wealth, while others seek to control the technology, financing, processing, and markets.
This contradiction lies at the centre of Brazil’s debate over critical minerals. The issue is not whether the minerals should be extracted at all, although every proposed mine must face serious environmental and social scrutiny. The immediate political question is whether Brazil will use these resources to build sovereign technological and industrial capacity or become, once again, an exporter of lightly processed raw materials.
The pressure is mounting rapidly. The United States-backed company USA Rare Earth has entered into a definitive agreement to acquire Serra Verde for approximately $2.8 billion. The US government provided $750 million toward the transaction and committed itself to purchasing hundreds of millions of dollars of future production. Serra Verde’s Pela Ema mine is especially attractive because its ionic clays contain dysprosium and terbium, heavy rare-earth elements vital for high-performance magnets and military equipment. Washington does not regard this as a normal commercial investment; rather, it views Serra Verde as part of a state-directed strategy to build a supply chain outside China.
Australia’s mining companies have meanwhile accumulated extensive mineral rights in Minas Gerais and Bahia. Viridis Mining and Minerals controls the Colossus project around Poços de Caldas, while Meteoric Resources holds the enormous Caldeira project in the same geological region. In Bahia, Brazilian Rare Earths – despite its name, an Australian-listed company – is developing the Borborema project. It is now well documented that foreign companies are rushing to acquire claims before the country establishes stronger rules over strategic minerals.
The geography of this rush is not empty. An investigation by the Observatório da Mineração found 187 rare-earth mining processes overlapping 96 agrarian-reform settlements in five states. Serra Verde alone held 37 active processes affecting eight settlements in Goiás. In Nova Roma, the Canadian-listed Aclara Resources’ Carina project initially overlapped the territory of the Família Magalhães quilombola community. Nearby lies the Kalunga territory, home to about 5,000 people and recognised as Brazil’s largest quilombola territory. Mining authorisations have also overlapped Kalunga land.
Around Pela Ema, rural families have reported changes in the colour and volume of streams, declining fish populations, and reproductive problems among cattle. Inspections by state and federal environmental agencies confirmed pollution in the Córrego Areia and concentrations of substances, including manganese, above drinking-water standards. The creek flows into the Cana Brava system, which supplies Minaçu and sustains fishing, agriculture, and tourism.
These costs must be set against what Brazil retains. Serra Verde produces mixed rare-earth carbonate, in which the valuable elements remain combined. The technologically difficult stages – separating individual oxides, producing metals and alloys, and manufacturing magnets – take place abroad. Brazil receives a mine, excavators, processing equipment, some employment, taxes, and environmental liabilities. The higher-value industries, patents, skilled technical employment, and strategic control migrate to the United States and Europe.
This is not merely a missing factory. Separation is the commanding height of the rare-earth industry. Because the seventeen rare-earth elements possess similar chemical properties, separating them requires complex hydrometallurgical systems, repeated solvent-extraction stages, specialised knowledge, and rigorous management of water and chemical residues. Magnet production adds further metallurgical and engineering barriers. A country that exports mixed carbonate but imports magnets has not secured a rare-earth supply chain. It has secured only the chain’s most environmentally destructive and least technologically powerful segment.
Foreign companies emphasise that Brazilian ionic clays can be worked with relatively cheap machinery. Deposits close to the surface can be excavated without the capital-intensive underground infrastructure required by other mines. Ore is dug, moved, washed, leached, and partially concentrated. Such projects are attractive precisely because companies can exploit abundant land and water while transferring the technologically sophisticated stages elsewhere.
The ‘cheapness’ is partly an accounting fiction. Machinery is cheap because the company does not pay the full cost of a damaged aquifer, a polluted stream, an eroded hillside, a displaced farming community, or decades of public-health monitoring. These are externalities: expenses removed from the corporate balance sheet and transferred to families, municipalities, and future generations. Water is treated as an industrial input even when it is the basis of an entire social ecology.
Nor is this model technologically inevitable. China’s rise in the rare-earth sector began with highly damaging mining practices, including extensive ammonium-salt leaching. Chinese researchers and public institutions have since invested in reducing these harms. A team of Chinese scientists developed electrokinetic mining, which uses controlled electric fields to move rare-earth ions through weathered clay. Initial trials reported 2.6 times greater recovery, an 80 percent reduction in leaching agents, and 70 percent fewer metallic impurities than conventional techniques.
The technique has now moved beyond the laboratory. An industrial-scale Chinese trial conducted on 5,000 tonnes of ore achieved 95 percent rare-earth recovery while reducing ammonia emissions by 95 percent. Its developers also found the method economically viable compared with conventional extraction.
Electrokinetic extraction is not impact-free, nor does it replace the downstream separation and magnet industries. But it demonstrates an important point: there is no technical justification for Brazil to accept yesterday’s water-intensive and chemically wasteful extraction systems while foreign owners reserve advanced research, refining, and manufacturing for themselves. The technology chosen for a mine is a political decision about who bears the costs and who acquires knowledge.
President Luiz Inácio Lula da Silva has urged Congress to accelerate legislation establishing a national policy for critical and strategic minerals. The proposed framework would create a national council, expand the state’s authority to review foreign investment, and encourage domestic processing. These are necessary beginnings, but encouragement alone will not be enough.
President Lula has said that Brazil requires public control over mineral information and strategic deposits; restrictions on foreign takeovers; mandatory domestic separation and refining; technology-transfer requirements; public investment through the BNDES, universities, Petrobras, the Geological Survey, and specialised research institutes; and binding targets for Brazilian production of oxides, alloys, magnets, batteries, and other finished products. Environmental licensing must include cumulative impacts on watersheds, not merely the footprint of each individual mine. Quilombola, Indigenous, and agrarian-reform communities must possess the enforceable right to prior, free, and informed consultation. Brazil can build its own public research, technological learning, and industrial capacity through cooperation with institutes and companies from places such as China.
Critical minerals are called critical because they sit at the centre of contemporary industrial power. If Brazil allows foreign corporations to own the deposits, choose obsolete extractive technologies, export mixed concentrates, and retain the patents and manufacturing abroad, then nothing fundamental will have changed since colonial times. Sovereignty begins when the wealth beneath Brazilian soil is converted into knowledge, industry, and a dignified life for the people who live above it.
