In brief
Brazil’s re‑elected President Luiz Inácio Lula da Silva has ordered that its rare earth minerals be processed inside the country, a move that undermines U.S. plans for fast access to the world’s second‑largest reserves. A new council will regulate investment and prioritize value‑adding projects, while still welcoming foreign capital under stricter rules. China and the United States now face a tighter competition for Brazil’s critical minerals.
On Nov. 5, 2026, Brazil’s election of President Luiz Inácio Lula da Silva set a new direction for the country’s rare‑earth industry, a move that puts U.S. investment plans on hold. The new government announced the creation of the National Council for the Industrialization of Critical and Strategic Minerals (CIM CE), which will set tighter rules and favor domestic processing over exporting raw minerals.
Previously, the Republican‑backed future president, Flavio Bolsonaro, was seen as a potential ally for U.S. companies eager to tap Brazil’s deposits. Encouraged by the possibility, Washington had been preparing investment incentives, hoping to beat China in the race for strategic materials needed for technology, automotive and energy sectors.
Under the new council, foreign investment will still be welcomed, but the focus will be on “in‑country processing, manufacturing, and investment in research and development,” a policy articulated by CIM CE member Marco Lage. “That’s what China has been doing for 30 years,” he said, pointing to the importance of value addition in the supply chain.
“What’s most important is to produce more in Brazil. To process, manufacture, add value and invest in knowledge, research and development,” Marco Lage said.
US officials had previously used tariffs and diplomatic pressure to try to secure preferential access, but the new regulations signal a broader strategy to reduce external extraction of Brazil’s mineral wealth. Both China and the United States now must adapt to tighter controls on downstream activity, altering the dynamics of the global rare‑earth market.
