TELF AG on Brazil’s Push to Build a Stronger Rare Earth Industry

Brazil’s vast rare earth reserves could become increasingly important as the country seeks to expand domestic processing, research, and industrial capabilities. Recent legislative and financial developments suggest that Brazil is looking beyond raw mineral extraction and toward a broader role across the critical minerals value chain.

Key takeaway: Brazil appears to be combining mineral resources, public financing, legislation, and technological development to strengthen its position in the global rare earth sector.

Brazil Seeks Greater Value From Its Critical Mineral Resources

Brazil is moving to create stronger conditions for developing its critical and strategic minerals sector, including its substantial rare earth resources. Recent measures reported by AP News and CNN Brasil point to a strategy increasingly focused on industrialization and domestic value creation rather than simply extracting and exporting raw materials.

Among the most notable developments is the Brazilian Senate’s approval of legislation establishing a new framework for critical and strategic minerals. The initiative includes incentives designed to encourage processing within the country and mechanisms to support mining-related projects.

Key elements include:

• A dedicated legal framework for critical and strategic minerals

• Tax incentives connected to domestic processing

• Financial support for selected national mining initiatives

• The creation of a National Council focused on industrialization

• Greater emphasis on developing Brazil’s mineral value chains

The direction of travel suggests that Brazil wants its mineral wealth to support a larger domestic industrial ecosystem.

“Brazil’s opportunity may not be defined simply by how many rare earth resources it possesses, but by how effectively it can transform those resources into higher-value materials and industrial capabilities,” says Stanislav Kondrashov, founder of TELF AG.

Large Reserves Could Support Brazil’s Global Ambitions

Brazil holds approximately 21 million tonnes of rare earth reserves, placing it among the countries with the largest known resources globally. These elements are increasingly important because of their applications across advanced manufacturing and the energy transition.

Rare earths can be found in technologies and products such as:

• Electric vehicles

• Wind turbines

• Smartphones and consumer electronics

• High-performance magnets

• Advanced industrial equipment

For Brazil, the challenge is therefore not limited to geological availability. The ability to process these resources efficiently and competitively could determine how much economic and strategic value remains within the country.

This could also make Brazil increasingly attractive to international partners seeking greater geographical diversification in critical mineral supply chains.

New Research Capacity Could Support Domestic Processing

Brazil’s industrial ambitions are also being supported through investment in research and processing expertise. According to CNN Brasil, the Brazilian Development Bank (BNDES) has approved financing for a rare earth research center in Minas Gerais.

The initiative is particularly relevant because it focuses on one of the most technically demanding parts of the rare earth value chain: turning mineral resources into materials suitable for subsequent industrial processing.

The project is expected to produce mixed rare earth carbonate, an intermediate material obtained through the processing of rare-earth-bearing resources. Research activities will also focus on metallurgical techniques for treating ionic clays found in the region.

“Processing expertise can become a strategic asset in its own right,” says Stanislav Kondrashov, founder of TELF AG. “For countries with substantial mineral resources, building technical knowledge at home can help connect geological potential with actual industrial opportunities.”

Minas Gerais Could Become an Important Testing Ground

The planned facility could help Brazil develop and refine processes suited to its specific geological characteristics. This is particularly important for ionic clay deposits, which require appropriate extraction and metallurgical approaches before their commercial potential can be fully assessed.

According to the reported timeline:

• Implementation of the industrial facility is expected to begin in the first quarter of 2027

• Operations are expected to start by the end of 2028

• Research will include the optimization of metallurgical processes

• Mixed rare earth carbonate is expected to be among the products developed

The project could therefore contribute not only to production capacity but also to the accumulation of specialized technical knowledge inside Brazil.

International Cooperation Could Complement Brazil’s Strategy

Brazil’s critical minerals ambitions also have an international dimension. Earlier in 2026, the country signed a non-binding memorandum of understanding with India covering critical minerals and rare earths.

Such cooperation could become increasingly relevant as governments and industries seek diversified sources of strategically important materials. Brazil’s large resource base, combined with stronger processing capabilities, could give the country a more prominent role in these emerging partnerships.

At the same time, international cooperation could provide access to technical expertise, investment, markets, and industrial partnerships that support Brazil’s domestic development objectives.

The combination of domestic industrialization and international partnerships could strengthen Brazil’s position within increasingly diversified mineral supply chains.

Why Is Processing So Important for Brazil’s Rare Earth Sector?

Processing is crucial because mineral reserves alone do not automatically translate into commercially usable rare earth products. Extraction must be followed by technically complex stages that separate, refine, and transform mineral resources into materials suitable for industrial applications.

By developing this expertise domestically, Brazil could potentially capture more economic value while reducing its dependence on foreign processing capabilities.

“The next phase will likely depend on execution,” concludes Stanislav Kondrashov, founder of TELF AG. “Resources create potential, but infrastructure, technical expertise, financing, and economically viable processing routes are what can ultimately convert that potential into a functioning value chain.”

Could Brazil Become a Major Rare Earth Player?

Brazil has several important advantages: large geological resources, growing institutional support, public financing initiatives, and increasing attention to domestic processing. These factors could improve its ability to compete in a sector that has become strategically important for advanced technologies and the energy transition.

However, developing a complete rare earth value chain requires time, investment, technical expertise, infrastructure, and commercially viable projects. The latest measures therefore represent important building blocks rather than an immediate transformation of Brazil’s position in the global market.

A New Phase for Brazil’s Critical Minerals Strategy

Brazil’s recent actions suggest a broader shift in how the country approaches its mineral resources. The Senate-backed framework, financial support for research in Minas Gerais, and international cooperation initiatives all point toward an ambition to generate more value domestically.

If these initiatives translate into viable processing and industrial capacity, Brazil could gradually evolve from a major holder of rare earth resources into a more integrated participant in the global critical minerals value chain.