The US government is betting big on a mine in central Brazil to solve one of its most stubborn strategic vulnerabilities: near-total dependence on China for the rare-earth minerals that power everything from F-35 fighter jets to electric vehicles.
The Serra Verde mine in Goiás state, Brazil, is at the center of a multi-billion-dollar push that includes a $2.8 billion acquisition by USA Rare Earth, a $565 million loan from the US International Development Finance Corporation (DFC), and a combined $1.55 billion commitment from the Department of War and Defense Logistics Agency.
What’s actually happening on the ground
Serra Verde entered commercial production in early 2024, making it Brazil’s only commercial-scale producer of all four key magnet rare earths: neodymium, praseodymium, dysprosium, and terbium. They’re the building blocks of permanent magnets used in EV motors, wind turbines, and defense systems.
The mine is targeting output of roughly 6,400 metric tons per year of total rare earth oxide equivalent by the end of 2027.
USA Rare Earth announced its $2.8 billion acquisition of Serra Verde in April 2026, with the deal pending regulatory approval. The DFC’s $565 million loan package is designed to support both current operations and future expansion. Meanwhile, the $1.55 billion financing structure from the Department of War and its partners includes $750 million in direct government investment and a $300 million forward purchase agreement, essentially Washington pre-ordering the mine’s output to guarantee demand.
Why Brazil, and why now
Brazil sits on approximately 21 million metric tons of rare earth reserves, the second-largest deposit in the world after China. China currently controls roughly 60-70% of rare earth mining and approximately 90% of downstream processing.
Long-term supply contracts between Serra Verde and Chinese buyers are set to terminate in 2026, opening the door for Western investors and governments to lock in supply agreements. Brazil’s government has also signaled interest in developing domestic processing capabilities as a condition of foreign investment.
China has periodically restricted rare-earth exports as a diplomatic tool, most notably during disputes with Japan in 2010 and more recently amid escalating trade conflicts.