Brazil has one of the largest reserves of rare earth elements on the planet.

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Brazil may possess one of the largest reserves of rare earth elements on the planet, but today it practically does not exploit these mineral resources.
Rare earth elements are used in supermagnets, tablet screens, computers and cell phones, in the gasoline production process, and in solar panels.
Estimates from the U.S. Geological Survey (USGS) indicate that Brazilian reserves could reach 3,5 billion tons of rare earth elements.
With an eye on Brazil's potential, the Certi Foundation of Santa Catarina, the Institute for Technological Research (IPT) of São Paulo, and the Center for Mineral Technology (Cetem) of Rio de Janeiro are working together to support private initiatives, should Brazil decide to explore these mineral resources and enter the market.
Rare earth reserves
Today, the market is entirely dominated by China, which is responsible for 95% of production and owns 36% of known reserves. The global market value for rare earth oxides is around US$5 billion annually.
“We are structuring ourselves so that, if someone is interested in entering the mining sector, we can support their initiatives. We have some research projects, but we are starting slowly because if rare earth mining in Brazil doesn't mature, there's no point in investing in research and development for exploration and production,” says Fernando Landgraf, director of innovation at IPT.
As part of the academic institutions' efforts to bring the issue up for discussion and contribute to the debate, Landgraf published an article in the Valor Econômico newspaper on April 13th, drawing attention to Brazil's potential.
Within the 3,5 billion tons of rare earth elements, after the industrial processes that concentrate and separate the chemical elements that occur in aggregate form in the ores, there are 52,6 million tons of metal.
This estimate from the USGS is included in the document "The Major Rare Earth Element Deposits in the U.S. – A Summary of Domestic Deposits and a Global Perspective."
Based on data from CPRM geologist Miguel Martins de Souza, published in a specialized scientific journal, the USGS also calculated that the 2,9 billion ton reserve of rare earth elements in the Seis Lagos mine in the Amazon would result in 43,5 million tons of contained metal.
In Araxá, Minas Gerais, at a mine operated by Vale, there is estimated to be the second largest deposit in Brazil: the document estimates 450 million tons of rare earth elements and 8,1 million tons of contained metal for this mine.
Rare Lands
Rare earth elements are 17 very similar chemical elements that differ in the number of electrons in one of the electron shells of the atom. They are grouped into a family in the periodic table because they occur together in nature and are chemically very similar.
They also share the common characteristic of having complicated names: lanthanum, neodymium, cerium, praseodymium, promethium, samarium, europium, gadolinium, terbium, dysprosium, holmium, erbium, thulium, ytterbium, scandium, and lutetium.
Despite what the name suggests, these metals are not as rare as gold, for example.
While it wasn't worthwhile for Brazil to enter the sector until a few years ago, due to a lack of competitiveness with China, the potential of Brazilian reserves and the increase in rare earth prices on the international market could make the business economically viable, argues the director of IPT.
Prices skyrocketing
On average, rare earth prices on the international market have practically tripled in recent years, according to Landgraf.
Neodymium oxide, which cost US$15 per kilogram in January 2009, reached a value of US$150 per kilogram in January 2011.
“At a time when prices rise so much, what wasn't economically viable three years ago can become viable now. And Brazil is in a position to have the largest reserve of rare earth elements on the planet,” he points out.
Some of Brazil's reserves are well known, particularly the phosphate deposits in Poços de Caldas, Araxá, and Catalão. Rare earth elements are contained in the tailings from phosphate mining. "These are mines that are no longer in the mineral exploration phase, but in the economic viability phase: we know how much there is, but is it economically viable to concentrate it?" explains Landgraf.
China and rare earth elements
The increase in rare earth prices is directly related to what has happened in the Chinese market, explains Landgraf. Concern for the environment has increased significantly in China in recent years, and the government has been pressuring companies to improve their practices.
Rare earth producers are being hit hard, as it is an activity that causes a high environmental impact in China. "When the Chinese government pushed to regulate the environmental aspect of production, many mines and small processing companies closed, decreasing supply," he adds.
Despite this contraction in supply, the Chinese market continues to grow, and China's consumption of rare earth elements has increased much more than consumption in the rest of the world.
"China used to be an exporter because it didn't consume much, but the increase in domestic demand means there are fewer rare earths left to be exported," he points out. There is also suspicion that the Chinese are adopting export quotas, which motivates other countries to buy more of these minerals to stockpile.
Last year, China demonstrated its control over the supply of rare earth elements: it embargoed exports of rare earths to Japan in retaliation for the arrest of a Chinese fishing boat captain in a maritime area disputed by both countries. The Japanese faced problems, as their industry relies on high-tech products that utilize rare earths.
Given this scenario, the United States, for example, has already identified rare earth elements as critical resources for its economy, which is also based on the production and sale of high-tech products. The company Molycorp Minerals, with operations in California, is investing US$200 million to restart its factory.
Rare earths in Brazil
In Brazil, some movement is also being observed. The Minister of Science and Technology, Aloizio Mercadante, is in talks with Vale about the possibility of the mining company entering the business, something that will require government support, favorable financing conditions, improvements in transportation and logistics, and investments in R&D so that the venture can compete with Chinese production, as reported by the Valor Econômico newspaper on May 11.
“Around 10 companies in Brazil are discussing the topic [of entering rare earth production]. Vale is cited as the largest, but there are other interested parties who are not publicly commenting,” says the director of IPT.
Another initiative from the Ministry of Science and Technology (MCT) involves negotiating a technical cooperation agreement on innovation with Germany, through which pilot projects for the production of supermagnets, which use rare earth elements, would receive support from the Fraunhofer Institute, according to the aforementioned report in the São Paulo newspaper.
Another government initiative, which has received little attention so far, is that of the company CPRM Serviços Geológicos do Brasil, linked to the Ministry of Mines and Energy (MME). In 2011, it began implementing the project "Assessment of the Potential of Strategic Minerals in Brazil," which will identify new areas throughout Brazilian territory where rare earth elements may occur. The project is expected to last three years and receive R$ 18,5 million in funding from the Growth Acceleration Program (PAC). In 2011 alone, the government plans to invest almost R$ 2,4 million in the project, according to CPRM.
Technology for rare earth exploration
Landgraf states that the technologies for mining and land processing are mastered.
“We already knew how to do it in the past, and we have the expertise to produce rare earth elements. There is no insurmountable technological challenge,” he continues.
He recalls that Brazil produced supermagnets in the 90s. "There were at least five research groups making supermagnets; that was the topic of my doctoral thesis. We even had a company producing supermagnets; it went bankrupt in 1994," he comments.
According to the director of IPT, the problem is economic. "The question is whether anyone has the resources to set up a company in Brazil, or whether we can have a group of companies enter the sector and face potential Chinese dumping," he analyzes.
From a research and development standpoint, Landgraf explains that it would be necessary to study production on an industrial scale. “We’ve done things on a laboratory scale, not on a commercial scale. So, if there’s a business and government decision and the country enters this sector, the next challenge is to develop pilot-scale processes to reach industrial scale,” he says.
He adds that today Brazil has instruments to finance industrial plants planned in R&D projects that operate on a pilot scale, such as Funtec, a program of the National Bank for Economic and Social Development (BNDES).
Technology for use
Landgraf argues that Brazil should not be merely an exporter of minerals, but should develop the entire production chain. This begins with the mining and concentration of rare earth elements, the lower-value stages in the chain. Next comes the chemical industry, responsible for the separation stage.
“There is no such thing as a rare earth magnet; there is only a neodymium magnet. Rare earths are chemically similar, so you need to separate one from the other,” he explains. “The necessary technology is relatively sophisticated, but we know how to do it in universities and research institutes,” he continues.
He comments that, in the past, there were research groups at USP, Cetem, and other centers that performed the separation in the laboratory, but everything fell apart in the 1990s when China began to offer low prices on the international market. "São Paulo has a tradition in this; we had the company Orquima, which was later acquired by Nuclebras and renamed Nuclemon, subsequently incorporated by Indústrias Nucleares do Brasil (INB)," he recalls.
The market for rare earth elements is growing. Today, the world consumes 150 tons of rare earth elements per year, according to the director of IPT. Neodymium, the most widely used chemical element within this group, is present in supermagnets. These, in turn, are increasingly used in motors that need to have small dimensions, such as those that regulate seats and mirrors in more luxurious automobiles.
“These are magnets that allow for the miniaturization of motors. This market is going to grow a lot,” points out Landgraf. The wind power generator can be made with supermagnets, another niche application that is expanding with the need for renewable energy sources.
Lanthanum is used to manufacture gasoline. In one of the stages of fuel production at the refinery, gases pass over a lanthanum oxide catalyst, which promotes the joining of the molecules that form gasoline. "Brazil consumes 1.000 tons of lanthanum per year. It's not a large market, but if we don't have lanthanum, we can't produce gasoline. We are dependent on China," he emphasizes.
The other 12 elements that make up the rare earth group are used in smaller quantities in various applications. Cerium oxide, for example, is used to polish eyeglass lenses.
In white LEDs, which are replacing fluorescent lamps because they consume less energy, rare earth oxides are also used. “The laser is green, blue, or red. To obtain white light, the laser hits a white fluorescent layer, and what generates this white light is a mixture of rare earth oxides applied to the LEDs,” he explains. “If the LED market grows as projections indicate, a lot of rare earth will be needed,” he states.

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