Trump Courts Brazil for Rare Earths and Minerals

Washington is recalibrating its approach to Brazil, seeking access to critical minerals even after a period of strained relations marked by tariffs imposed by the Trump administration. The shift comes as the United States aims to reduce its dependence on China for materials essential to industries ranging from electric vehicles to defense systems.

The change in tone from Washington follows a period of friction initiated in July 2025, when President Donald Trump levied substantial tariffs – exceeding 60 percent on most products – on Brazilian goods. The action was presented as a response to the Brazilian judicial system’s handling of legal proceedings involving former President Jair Bolsonaro, which Trump characterized as a “witch hunt.”

While those tariffs have largely been lifted and President Trump has engaged in multiple conversations with Brazilian President Luiz Inácio Lula da Silva, the renewed interest appears driven by strategic considerations rather than personal rapport. Brazil possesses significant reserves of rare earth minerals and other critical resources, positioning it as a potentially vital partner for the United States.

According to the U.S. Geological Survey, Brazil holds the second-largest reserves of rare earth minerals globally, accounting for approximately one-quarter of the world’s total. These 17 chemically similar elements are crucial components in a wide array of modern technologies.

For Brazil, this presents a significant economic and political opportunity. Currently, China dominates the rare earth market, controlling around two-thirds of global mining output and nearly 90 percent of refining capacity. This dominance has allowed China to wield geopolitical influence, demonstrated recently by temporary restrictions on exports of certain rare earth elements, which disrupted production in European and American factories.

Many nations are now seeking to diversify their supply chains and reduce reliance on China. The United States is actively pursuing this goal through initiatives like “Project Vault,” announced on January 30, 2026. This plan involves establishing a strategic stockpile of critical minerals, backed by $1.67 billion in private capital and a $10 billion loan from the U.S. Export-Import Bank.

The initiative has already spurred activity in the U.S. Rare earth mining sector, with shares of companies like MP Materials, USA Rare Earth, and Critical Metals Corp. Rising following the announcement. MP Materials, which operates the Mountain Pass mine in California, saw its stock increase by more than 2 percent in extended trading. USA Rare Earth is reportedly in discussions with the Commerce Secretary Howard Lutnick regarding potential funding of approximately $1.6 billion, potentially including a U.S. Government equity stake.

Beyond rare earths, Brazil is also a key producer of other critical minerals, including niobium, nickel, bauxite, and graphite. Production of copper and lithium has also increased rapidly in recent years. Consulting firm PwC identifies Brazil as a key player in the global energy mineral market, estimating that the country holds roughly 10 percent of the world’s reserves of critical minerals.

The U.S. Government’s renewed focus on Brazil is evident in increased engagement with Brazilian mining companies. A high-ranking U.S. Official met with Brazilian firms at a mining conference in Salvador in October 2025 to discuss potential supply agreements. The U.S. Development Finance Corporation (DFC) has made its first investment in Brazilian mining, providing $456 million to Serra Verde, a Brazilian rare earth producer. Aclara has also received a $5 million grant from the DFC.

Other nations are also vying for access to Brazil’s mineral wealth. Japan, France, and Canada are reportedly preparing agreements with Brazil, and the European Union plans to announce investment commitments for five projects focused on critical minerals in March. The number of applications for prospecting licenses submitted to the Brazilian National Mining Agency (ANM) nearly tripled in the past year, reaching 400.

Despite the growing interest and potential, challenges remain. Brazil’s regulatory framework for mining is often cited as a bottleneck, with the ANM chronically understaffed and underfunded. Delays in passing new legislation aimed at establishing a national policy for critical and strategic minerals are also hindering progress. A bill has been stalled in Congress since 2024.

However, there is a growing recognition within Brazil of the importance of developing its mineral resources. The pressure from the United States and other countries has spurred increased activity in the sector, and Brazilian mining companies are seeking to expand their operations. While Brazil’s current production of rare earth chemicals – 20 tons in the first half of 2025 – represents only a 1 percent share of the global market, compared to China’s 270,000 tons, the potential for growth is substantial.