Brazil's Minister Silveira: US can produce critical minerals at lower cost in our country

Brazil's Minister of Mines and Energy Alexandre Silveira argued that the US should invest in critical mineral projects in Brazil, stating that the growing global demand for these resources has made the country an attractive hub, particularly for North American investors. Speaking to reporters following an event in Belo Horizonte, Silveira emphasized that China and the US are in a kind of trade war to access these strategic resources and that, thanks to its potential, Brazil could be a strong partner for the Donald Trump administration.

Minister Silveira stated that the production chain of these strategic resources needs to be brought to Brazil, suggesting that China might be reluctant in this regard due to lower production costs and a fully integrated chain, whereas the US might look favorably on producing on Brazilian soil in its search for more competitive costs. Furthermore, he mentioned that during Brazilian President Luiz Inácio Lula da Silva's visit to the US, they discussed a possible partnership in rare earth metals and that this opportunity should be leveraged to attract investment to the country through critical minerals, especially rare earths.

In recent months, interest from the US and European countries in Brazil's mining potential has visibly increased. As the host of the world's second-largest rare earth reserves, Brazil appears as a strategic alternative for Western countries, such as the US and the European Union, seeking to reduce their dependency on China, which dominates more than 90% of the current global rare earth supply chain.

Rich in raw materials, Brazil unfortunately does not yet possess the desired control over other stages of the chain, such as the separation, refining, processing, and final product production of these minerals. The current government advocates for ensuring that critical minerals are not merely extracted and exported, but are also refined and processed on national soil, aligning this approach with the sovereignty discourses of the Planalto Palace.

Legal regulations regarding the issue are also on the legislative agenda; the Brazilian Chamber of Representatives approved in May the law establishing the National Critical Minerals Policy, which includes a 5 billion real sector fund and tax incentives for companies that will carry out production stages on national soil, prepared with government approval. Aiming to regulate the sector and increase state control, this bill is currently awaiting review in the Senate.