The re-election of Luiz Inacio Lula da Silva as Brazil's president is expected to dash United States hopes of securing swift access to the world's second-largest reserves of rare earth metals, according to Reuters.

Instead of fast-tracking raw exports, Lula's government plans new regulations for the sector through the National Council for the Industrialisation of Critical and Strategic Minerals, known as CIMCE. Three council members told Reuters that US investment would still be welcome, but processing rare earths inside Brazil would take priority over exporting them as unprocessed raw materials.

The new rules will govern investment incentives and the designation of priority projects in the rare earth sector, which is essential to the technology, automotive and energy industries. At its first meeting on Thursday, which Lula attended, the council decided that 27 minerals fall under its remit, with rare earths classed as a high priority for Brazil.

Council gains powers over deals and ownership

CIMCE will have the power to approve changes in the ownership or control of companies holding mining rights for critical and strategic minerals. It will also approve international contracts, agreements and partnerships involving the supply of those minerals, to safeguard what the council describes as Brazil's economic or geopolitical security.

Lula signed Brazil's National Policy on Critical and Strategic Minerals into law about two weeks before the first round of voting, creating CIMCE and launching an overhaul of the regulatory framework, including investment incentives and risk-mitigation measures for investors. The government aims to present the new regulations within the first few months of 2027.

Serra Verde, backed by the US government, is currently the only commercially operating rare earth mine in Brazil.