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The Context
China controls 90 percent of global rare earth processing, giving Beijing leverage over supply chains for electric vehicles, wind turbines, and defense technology. Brazil holds the world’s third-largest rare earth reserves, but extraction has lagged for decades. That gap is closing as Western firms pour capital into Brazilian projects to derisk geopolitical exposure.
The Takeaway
CFOs at manufacturers dependent on rare earth imports should model dual-sourcing scenarios now. Brazil’s production ramp won’t hit scale until 2027, but procurement teams that lock early offtake agreements will avoid the premium when Chinese export restrictions tighten. The window is 18 months.
Source: Dw