Rare Earth Exchanges

Brazil’s Serra Verde: A Key Player in Rare Earth Supply Chains Amid Global Trade Shifts

Leave a Comment

Highlights

  • Serra Verde raises $150 million to expand rare earth production.
  • Aiming for 5,000 tons of rare earth oxides annually by 2026.
  • Recognized by the Minerals Security Partnership.
  • Offers a strategic alternative to China’s near-monopoly in rare earth elements.
  • The company’s sustainable approach and strategic positioning could transform global critical minerals supply chains for clean energy technologies.

Brazilian mining company Serra Verde Group (opens in a new tab) is making significant strides in the global rare earth elements (REE) market, positioning itself as a critical supplier amid growing trade tensions between the United States and China. According to a press release (opens in a new tab) issued on October 21, 2024, the company has secured recognition from the Minerals Security Partnership (MSP), underlining its strategic importance in the global energy transition. Additionally, Serra Verde has raised $150 million from investors, including Denham Capital, Energy and Minerals Group, and Vision Blue Resources, to fund capacity enhancements and long-term growth initiatives.

Expanding Capacity to Meet Growing Demand

Serra Verde, based in Brazil’s Goiás state, began commercial production of rare earth concentrates in early 2024. The company is currently ramping up its operations, with plans to achieve an annual output of 5,000 tons of rare earth oxides by 2026, according to (opens in a new tab) Bloomberg from January 2.

Chief Operating Officer Ricardo Grossi (opens in a new tab) noted that strategic partnerships with other companies and nations are being explored to further expand production and processing capabilities.

These efforts are timely, as the US and its allies seek alternatives to China’s near monopoly in the rare earth market. The Asian nation controls 70% of mined REE material and 90% of refining capacity, making it a linchpin in global supply chains for EVs, wind turbines, and military hardware. Serra Verde’s neodymium, praseodymium, terbium, and dysprosium output positions it as a reliable source for diversifying supply chains, particularly if China enforces stricter export controls.

Acknowledgment by the Minerals Security Partnership

The MSP, a consortium of 14 nations and the European Union, has recognized Serra Verde’s potential to contribute to sustainable and diversified critical mineral supply chains. The partnership aims to promote projects that adhere to high environmental, social, and governance (ESG) standards, facilitate recycling, and increase local value addition. Serra Verde’s commitment to sustainability is evident in its use of renewable electricity, biofuels, and simple processing technologies with low environmental impact, as highlighted in its press release.

Investment Driving Growth and Innovation

The $150 million investment will enable Serra Verde to optimize its current operations, alleviate bottlenecks, and explore the feasibility of a second-phase expansion that could double production by 2030. CEO Thras Moraitis emphasized the importance of this funding in supporting the company’s ambitious growth plans. “This endorsement strengthens Serra Verde’s role in establishing secure and diversified rare earth supply chains to facilitate the global energy transition,” Moraitis stated. Grossi added that the company’s financial outlook is set to transform significantly by 2026 as it begins to capitalize on increasing global demand for rare earths, projected to grow at 8.5% annually through 2035.

A Strategic Alternative for the West

Despite current market pressures, including a supply glut that has depressed prices, Serra Verde remains optimistic. The company’s focus on supplying Asia, alongside its expanding role as a Western alternative to China, underscores its importance in the geopolitical landscape.

With ongoing negotiations for further funding and strategic collaborations, Serra Verde could be well-positioned to enhance its influence in the critical minerals sector. As countries worldwide prioritize sustainable and resilient supply chains, Serra Verde’s advancements mark a significant step forward in the global shift towards clean energy and technological independence.

Spread the word: