Trump Already Has a Victory in Lula’s Brazil
Summary
The article argues that the United States has gained access to Brazilian rare earths despite political tensions between President Donald Trump and Brazil’s President Luiz Inácio Lula da Silva. It points to financing, a long-term supply agreement and a company acquisition involving Serra Verde as ways the U.S. can secure strategic materials while Brazil seeks more domestic processing and economic benefits.Key Facts
- Serra Verde said an agreement covering all of its Phase I production for 15 years took effect on August 24.
- The agreement’s buyer is a special-purpose vehicle backed by $750 million from the U.S. Department of War.
- USA Rare Earth completed its acquisition of Serra Verde on September 3; the company has a $1.6 billion funding deal with the Commerce Department.
- The U.S. International Development Finance Corporation signed a $565 million loan agreement to expand and improve Serra Verde’s Brazilian mine.
- The supply agreement sets minimum prices for four rare earths used in permanent magnets for electric vehicles, wind turbines and defense equipment.
- Serra Verde describes its mine as the only large-scale producer outside Asia of all four magnetic rare-earth elements.
- A Brazilian law signed by Lula on September 16 promotes domestic mineral processing and industrial development, and gives a government council a role in reviewing certain corporate changes involving mineral assets.
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