On August 6, 2025, Brazilian President Lula da Silva revealed to Reuters his plans for a new national policy that treats strategic minerals as a matter of “national sovereignty” in order to avoid exporting minerals without adding local value. This was in response to the announcement by Gabriel Escobar, Chargé d’Affaires at the U.S. Embassy in Brazil, about U.S. interest in Brazil’s strategic minerals during his meeting with the Brazilian Mining Institute (IBRAM), a private entity representing companies in this sector. With U.S. President Donald Trump’s administration imposing 50% tariffs on Brazilian exports, the rising tension between Brazil and the United States has gained new momentum, with critical minerals emerging as a major subject of discussion between the two countries.
Growing Importance
Rare earth minerals have become central to trade talks between the United States and Brazil, due to the following factors:
1. Brazil’s possession of massive amounts of critical minerals:
Government data confirms that Brazil holds about 94% of the world’s niobium reserves, essential for steelmaking, civil construction, turbines, high-speed trains, batteries, and aerospace and military equipment, such as hypersonic missiles. It also has significant shares of nickel, graphite, and manganese. Government plans and industry reports suggest that Brazil could supply nearly 15% of global lithium by 2030. Brazil’s reserves of this metal are concentrated in the northeastern region, in the states of Minas Gerais and Bahia. Brazil possesses about 23% of the world’s rare earth reserves, ranking third globally after China and Vietnam. However, it accounts for less than 1% of global production, as many untapped reserves are located in areas such as the Amazon rainforest—posing a challenge for Brazil to balance protecting degraded forests with exploiting its abundant mineral wealth.
2. Trump administration’s push to pressure Brazil in trade negotiations:
The United States imposed a 50% tariff on Brazilian exports under the pretext of protecting American jobs and enhancing national security by encouraging domestic mineral processing and manufacturing. In this context, U.S. officials hinted at demands for preferential access to Brazil’s mineral resources in exchange for a favorable trade deal, indicating Washington’s desire to use Brazil’s vital minerals as a bargaining chip in negotiations. Despite Brazil’s mineral wealth, only about 3% of its mineral exports go to the United States, which explains Washington’s desire to increase supplies from Brazil as well as its push for greater U.S. corporate participation in the Brazilian mining sector.
3. Growing global competition for rare minerals:
In recent years, competition among major powers over strategic mineral supplies—especially lithium—has intensified. Access to them has become synonymous with holding power and ensuring technological superiority, given their vital role in future industries, from electric vehicles and solar panels to military equipment and advanced smartphones, as well as their growing importance in the global energy transition. The presence of about 52% of global lithium reserves in the so-called Lithium Triangle—Bolivia, Argentina, and Chile—has drawn the attention of the world’s key economic players and spurred a race to secure the metal. Between 2019 and 2022, Chinese companies invested about $4.5 billion in lithium projects in Mexico and South America. Increasing amounts of Latin American minerals, including those extracted and processed by Chinese companies, are flowing into China as a result. According to Boston University’s Global Development Policy Center, China’s share of extractive exports from Latin America grew from 1% in 2000 to 34% in 2020.
4. U.S. desire to diversify global supply chains:
President Trump seeks to secure U.S. supplies of vital minerals and criticizes China’s dominance of the sector, given its control over about 60% of global rare earth production and nearly 90% of refining or processing. The U.S. obtains 80% of its rare earth imports from China. Earlier this year, with Beijing imposing strict export controls on some minerals, the Trump administration began striking deals with certain countries—including Ukraine—to secure vital minerals.
In July 2025, President Trump welcomed leaders of five African countries to the White House for a strategic summit, one of its main goals being to negotiate U.S. access to vital minerals. That same month, Trump announced a 50% tariff on copper imports from Chile, Canada, and Mexico, effective August, in an effort to protect local industry and pressure foreign suppliers. Recent exploration results in Brazil indicate significant lithium reserves, positioning the country to become a major supplier of this metal in the coming years, potentially serving as a viable alternative to Chinese dominance in some vital mineral markets and bolstering supply chain diversification.
Brazilian Responses
Amid persistent talk of U.S. interest in accessing Brazil’s rare earth minerals, President Lula’s government has adopted several positions at both the rhetorical and practical levels, including:
1. Commitment to protecting national sovereignty over critical minerals:
President Lula criticized statements by a U.S. embassy official suggesting that Brazilian “rare earth” minerals be included in bilateral discussions. He stressed that these resources belong to the Brazilian people and should benefit them directly. Lula insisted that Brazil cannot allow rare earth exploration and other mineral resources to follow the model adopted by Ukraine in its agreement with the U.S., where American defense aid was reportedly conditioned on access to Ukraine’s strategic resources. Lula pledged to treat strategic minerals as a matter of “national sovereignty,” emphasizing the need for negotiations rather than economic threats or tariffs.
2. Forming a committee to map undiscovered wealth:
The president revealed that Brazil currently lacks a complete map of its mineral wealth and announced the creation of a committee to map untapped mineral reserves. He also disclosed that his government will establish the National Council for Mineral Materials and Standards, which will be directly linked to the presidency to protect the mineral sector and ensure exploration and processing occur domestically—enabling the country to become a global leader in the energy transition. He added that companies would not face difficulties once the council is established.
3. Strengthening the state’s role in mining activities:
Lula’s government is working to increase state involvement in the exploration and processing of important minerals. The creation of a state-owned company dedicated to processing rare minerals is a prime example of the growing trend toward what is known as “resource nationalism.” This reflects a shift in Brazil’s resource management approach, treating mineral assets as tools for securing economic independence and achieving sustainable growth rather than merely raw materials for export. Lula told Reuters: “We will not allow what happened in the past century to happen again, where Brazil exports raw minerals and then buys products with very high added value.” He added: “We want to add value in Brazil.”
4. Building national manufacturing capacity:
A 2023 UNCTAD report warned that reliance on exporting raw materials such as minerals poses a major challenge for developing countries and can create serious social and economic traps. The report argued that such dependency hinders economic development and perpetuates inequality and vulnerabilities across sub-Saharan Africa, South America, the Pacific, and the Middle East. To reduce exposure to external price volatility and supply chain disruptions, Brazil—a major exporter of iron ore and lithium—has begun placing special emphasis on investing in technology, research, and building domestic refining and processing capacities for strategic minerals, aiming to create jobs and generate added value.
5. Developing sustainable mining practices:
The United Nations notes that conflicts over mineral exploitation tend to grow—both within and across borders—and that 40% of all intrastate conflicts recorded in recent decades were linked to natural resource exploitation, including access to minerals. In this context, the Brazilian government is working to entrench environmentally responsible mining practices and strengthen the participation of Indigenous communities, which is one of the core principles of Brazil’s mining law. This is critical for maintaining a positive international image, attracting responsible investment, and ensuring the involvement of local communities, which have a long history of opposing environmentally unsustainable mining activities.
6. Diversifying international partnerships:
Brazil is exploring new ways to counter U.S. trade barriers and diversify its export markets, especially for strategic minerals, by entering into trade and investment agreements with countries beyond the United States, including the European Union, Russia, and China. Earlier this year, Brazilian and Russian officials began talks on joint uranium and lithium extraction. In February 2025, Chinese company BYD, a leader in electric vehicle industries, acquired mining rights in a lithium-rich region of Brazil.
In light of the above, it can be said that amid the global shift toward clean energy and the growing demand for advanced technology, competition over Brazil’s mineral supplies is likely to intensify, further heightening geopolitical tensions. Brazil will need to act strategically by developing a strong industrial policy and long-term vision to add value to its mineral resources—turning them into tools of economic and political leverage in an increasingly competitive global environment.
