This article examines two core aspects of Brazil’s green transition policy in terms of foreign interests in the country: rare earth mining and green hydrogen production.
Brazil is a strategic player in the global green transition. It currently produces 92% of the world’s niobium, a mineral classified as critical by the European Union (EU), and is estimated to hold around 23% of global rare earth reserves. With substantial renewable energy output, primarily from hydroelectric power plants, the country is also well positioned to become a major producer and exporter of green hydrogen, drawing interest from EU institutions. Furthermore, the Brazilian government has expressed support for carbon markets as an opportunity to secure funding, despite their questionable effectiveness in actually reducing emissions.
The 1992 Rio Convention saw the adoption of the United Nations Framework Convention on Climate Change (UNFCCC). The UNFCCC secretariat is responsible for convening the annual United Nations Climate Change Conference, also known as the Conference of the Parties (COP). Brazil holds the presidency of COP30 this year and has chosen Belém do Pará as the host city. Belém is located in the heart of the Amazon rainforest, one of the most biodiverse regions on the planet, though scarred by centuries of extractivism and deforestation. Under the leadership of President Lula da Silva, Brazil is seeking to set itself apart from previous COP presidencies and showcase its climate ambitions, even as it continues to back new oil extraction projects within its borders. For example, the government has recently applied for the country to join the Organization of the Petroleum Exporting Countries (OPEC+). After three consecutive years of COPs hosted by authoritarian, oil-producing nations with significant restrictions on civil society, this year’s summit is expected to take place in a very different context, characterised by widespread social mobilisation.
This article examines two core aspects of Brazil’s green transition policy in terms of foreign interests in the country: rare earth mining and green hydrogen production.
Rare earths are rapidly becoming a focal point of global geopolitical competition, due to their vital role in manufacturing numerous technologies linked to the green transition, digitalisation and the defence industry. The term refers to 17 elements in the periodic table that are grouped together because they share similar magnetic and conductive properties. Contrary to what their name might suggest, they are actually quite abundant. The adjective “rare” instead reflects the difficulty of obtaining them in a pure state, since complex chemical processes are required to separate them from the gangue. Originally used on a large scale for industrial lighting, rare earths now have a vast range of applications and are found in most of the technologies we rely on every day. When added in small quantities to other materials, they can produce unique effects and even substitute critical minerals in the production of specific technologies. Digital devices such as mobile phones, hard drives and fibre-optic cables depend on rare earths to function. They are also essential components in certain “green” technologies, including wind turbines, electric vehicles and some solar panels. At the same time, rare earths remain crucial to the fossil fuel industry.
They are used in the manufacture of combustion vehicles and in oil refining, as well as in military technologies such as drones, missiles and “smart” bombs. In light of the above, demand for these elements is expected to rise exponentially in the coming
years, and control over their supply will bring both political and economic power.
For its part, hydrogen is an energy carrier used in a range of industrial processes, particularly in oil refining and the production of chemical fertilisers. Decarbonising these sectors involves replacing grey hydrogen, produced from fossil gas, with green hydrogen obtained by splitting water molecules into hydrogen and oxygen using renewably sourced electricity. The fossil fuel industry is among the main stakeholders supporting the development of the global green hydrogen market, as it helps to sustain a centralised energy model built around large-scale, corporate-led projects. Agribusinesses, similarly, could use this transition to maintain their
own large-scale industrial food production model. Other industrial sectors, such as steelmaking and metallurgy, also use hydrogen in their production processes. Their importance is expected to grow as renewable technologies become the driving force behind the energy transition.