The newly approved bill, PL 2.780/2024, establishes a council under the presidency empowered to scrutinize ownership changes and long-term supply contracts. Industry leaders warn that this executive oversight risks chilling the very foreign capital required to modernize the sector. Pablo Cesario, CEO of the Brazilian Mining Institute, argued that the policy introduces excessive government discretion into what were previously purely commercial transactions.

Despite these regulatory shifts, the country faces a significant industrial bottleneck: Brazil possesses the world’s second-largest rare earth reserves but lacks the capacity to process them into finished magnets. Experts estimate that a fully domestic production chain is not viable before 2032 or 2035 at the earliest. Currently, major producers like Serra Verde continue to ship raw concentrates to Chinese refiners, leaving Brazil’s mineral wealth largely dependent on foreign processing chains for the foreseeable future.