South America rare earth supply rests almost entirely on a single operating mine: Serra Verde’s Pela Ema deposit in Goiás, Brazil — now the subject of a ~$2.8 billion acquisition by USA Rare Earth (Nasdaq: USAR) announced in April 2026. Brazil holds 21 million tonnes of rare earth reserves, second globally behind China’s 44 million tonnes according to the USGS Mineral Resources Program. Chile is at final permitting stage; Argentina remains at exploration. The region’s structural challenge — no rare earth separation capacity anywhere in South America — remains unresolved.
South America Rare Earth Reserves — Scale and Geology
Brazil’s 21 million tonnes of total rare earth oxide (TREO) reserves place it second only to China on any global ranking. Chile and Argentina hold additional deposits, though at far earlier stages: Argentina’s national geological survey has identified 190,395 tonnes of TREO resources — not reserve-grade by USGS classification — with potential resources estimated at 3.3 million tonnes excluding clay deposits.
The defining geological feature across the region is ionic clay mineralisation — the same deposit type responsible for the majority of China’s heavy rare earth element (HREE) output from Jiangxi and neighbouring provinces. Ionic clay deposits naturally concentrate dysprosium (Dy) and terbium (Tb), the two highest-value magnet metals and the hardest to source outside China. For full technical detail on these elements, see the site’s dysprosium overview and terbium overview.
The ionic clay profile means South American deposits are strategically significant beyond their headline reserve tonnage. A tonne of TREO from an ionic clay deposit in Goiás or Biobío carries a higher proportion of Dy and Tb than most hard rock carbonatite deposits — relevant context for Western buyers focused on NdFeB magnet supply chains rather than TREO volume alone.
Brazil — South America’s Only Producing Rare Earth Country
Serra Verde’s Pela Ema mine, located in Goiás state, entered commercial production in early 2024 and is the only operating ionic clay rare earth mine in the Western Hemisphere. Current output is estimated at 4,000–5,000 tonnes TREO per year, with a target of 6,500 tonnes by end-2027 over a 25-year mine life. Serra Verde is the only producer outside Asia supplying all four magnetic rare earths — neodymium (Nd), praseodymium (Pr), dysprosium (Dy), and terbium (Tb) — from a single operation.
The acquisition announced on 20 April 2026 would see USA Rare Earth acquire Serra Verde Group for approximately $2.8 billion, with closing expected in Q3 2026. The deal is supported by $565 million in financing from the US International Development Finance Corporation (DFC) and a 15-year offtake agreement with a US government-backed special purpose vehicle. Price floors under the offtake are set at $110/kg for NdPr, $575/kg for dysprosium, and $2,050/kg for terbium. Serra Verde’s management targets an annualised EBITDA run-rate of $550–$650 million by end-2027. Full acquisition detail is covered in the USA Rare Earth Serra Verde acquisition analysis.
One processing constraint shapes near-term output: Serra Verde concentrate is currently shipped to China for rare earth separation under supply agreements expiring at end-2026. Beyond that date, feedstock is being redirected toward Western processors. Brazil’s REE exports tripled in H1 2025 as the Serra Verde ramp-up accelerated, per Serra Verde’s published operations data.
Brazil’s development pipeline extends beyond Pela Ema. Aclara Resources (TSX: ARA) is advancing its Carina project in Nova Roma, Goiás, with 165.4 million tonnes of probable reserves containing 4,378 tonnes of TREO per year at full production, including 191 tonnes annually of combined Dy and Tb. An environmental impact assessment was submitted in May 2025, with production targeted for 2028. Meteoric Resources (ASX: MEI) is at prefeasibility study stage at its Caldeira project in Minas Gerais; Brazilian Rare Earths is drilling ionic clay and hard rock targets in Bahia. Full country coverage is at Brazil rare earth.
Chile Rare Earth — Aclara’s Penco Module in Final Permitting
Chile’s most advanced south america rare earth project is Aclara Resources’ Penco Module in the Biobío region, an HREE-weighted ionic clay deposit with measured and indicated resources of 27.5 million tonnes at 2,292 ppm TREO, containing 62,900 tonnes of TREO. An additional inferred resource of 303 million tonnes at 519 ppm TREO has been identified. Planned output is 800–1,700 tonnes TREO per year, focused on dysprosium and terbium.
Aclara revised and resubmitted its environmental impact assessment (EIA) in 2024, reducing the project footprint, eliminating a tailings facility, incorporating 95% water recycling, and committing to revegetation with native species — changes made partly in response to community concerns from local groups in Penco-Lirquén. A final addendum was submitted to Chile’s environmental authority in early 2026. The Chilean government selected Penco Module as one of 25 large-scale projects in its September 2024 Industrial Strengthening Plan for the Biobío region. Strategic partner CAP S.A., a Chilean mining conglomerate, is involved in project development.
Target production remains 2027, subject to permitting completion and financing. Aclara is also constructing an HREE separation plant in Louisiana, USA, scheduled for completion in 2027 — it will process feedstock from both the Chile and Brazil operations and is projected to supply more than 75% of US dysprosium-terbium demand for electric vehicles by 2028. Full country coverage at Chile rare earth.
Argentina Rare Earth — Exploration Stage, Early-Stage Potential
Argentina has no current rare earth production. The country’s only historical output was 1,010 kg of monazite extracted from the Teodesia mine in Valle Fértil between 1954 and 1956. At least 19 REE deposits have been identified across the northern provinces of Jujuy, Salta, La Rioja, and northern Mendoza, with identified resources of 190,395 tonnes TREO by Argentine national geological survey data — not classified to USGS reserve standard.
The most active current project is Litica Resources, which has an environmental impact study underway in the northern provinces but remains at pre-permitting stage. In February 2026, La Rioja province signed a tripartite agreement between state company EMSE, New York-based American Minerals, and SEGEMAR (Argentina’s federal geological survey) for REE prospecting and exploration. Argentina’s President Milei’s Incentive Regime for Large Investments (RIGI) offers 30-year regulatory stability for projects exceeding $200 million — a framework designed to attract foreign capital, including in critical minerals.
Argentina’s established critical minerals strengths remain lithium (third-largest global reserves, fourth-largest producer) and copper, where five world-class projects are under development. The country attended the February 2026 US Critical Minerals Ministerial in Washington. REE development is at an early stage relative to both Brazil and Chile. Full country coverage at Argentina rare earth.
The South America Rare Earth Processing Gap
No rare earth separation plant operates anywhere in South America as of 2026. Serra Verde ships concentrate to China under supply agreements expiring at end-2026; Aclara’s Louisiana plant — the first meaningful downstream step for South American feedstock — is on US soil, not South American. This processing gap is the defining structural constraint on the region’s role in Western supply chains.
Brazil’s President Lula has conditioned any formal critical minerals agreement with the United States on domestic value-add requirements — Brazil refining, not just mining. No bilateral agreement had been signed as of May 2026. The US has committed capital through the DFC ($565 million to Serra Verde, $5 million to Aclara Carina) and EXIM Bank (letters of intent totalling $455 million for regional rare earth development in 2025–2026), but processing infrastructure has not followed.
Scale context: China produced 16,001 tonnes of rare earths in Q1 2026 alone — up 4.8% year-on-year. South America’s entire 2026 output, from a single mine, is estimated at 4,000–5,000 tonnes annually. The region is past proof-of-concept in Brazil and in active permitting in Chile, but its long-term role in Western supply chain diversification depends on whether separation and processing infrastructure follows the reserves. For broader supply chain context, see the rare earth supply chain geopolitics analysis.
| Country | Reserves / Resources | Operating Mines | Key Projects | Stage | Key Company |
|---|---|---|---|---|---|
| Brazil | 21 million tonnes TREO (USGS) | 1 — Serra Verde Pela Ema | Aclara Carina; Meteoric Caldeira; Brazilian Rare Earths Bahia | Producing + pipeline | USA Rare Earth (Nasdaq: USAR); Aclara Resources (TSX: ARA) |
| Chile | 27.5 Mt M&I at 2,292 ppm TREO (Penco Module) | None | Aclara Penco Module, Biobío | Final permitting | Aclara Resources (TSX: ARA) |
| Argentina | 190,395 t TREO identified (national survey, not USGS reserve-grade) | None | Litica Resources (northern provinces); La Rioja EMSE / American Minerals | Exploration | Litica Resources; American Minerals |
Which South American country has the largest rare earth reserves?
Brazil holds 21 million tonnes of rare earth reserves — second only to China globally, according to the USGS. Chile and Argentina hold additional deposits, but at significantly earlier stages of development.
Is there an operating rare earth mine in South America?
Yes. Serra Verde’s Pela Ema mine in Goiás, Brazil entered commercial production in early 2024. It is the only operating ionic clay rare earth mine in the Western Hemisphere and the only producer outside Asia supplying all four magnetic rare earths — neodymium, praseodymium, dysprosium, and terbium — from a single operation.
What rare earth projects are advancing in Chile?
Aclara Resources’ Penco Module in the Biobío region is the most advanced project. It is an HREE-weighted ionic clay deposit with 27.5 million tonnes of measured and indicated resources at 2,292 ppm TREO. A final EIA addendum was submitted in early 2026; production is targeted for 2027, subject to permitting and financing.
Does South America process or refine rare earths?
No rare earth separation plant operates in South America as of 2026. Serra Verde ships concentrate to China for separation under agreements expiring at end-2026. Aclara Resources is building an HREE separation plant in Louisiana, USA, targeting 2027 completion — it will process feedstock from its Brazil and Chile operations, but the facility itself is not in South America.
Who acquired Serra Verde and what does it mean for the region?
USA Rare Earth (Nasdaq: USAR) agreed to acquire Serra Verde Group for approximately $2.8 billion in April 2026, with close expected in Q3 2026. The deal is backed by $565 million in DFC financing and a 15-year government-backed offtake agreement. It positions Brazil’s Serra Verde operation as a cornerstone of US rare earth supply chain strategy outside China.
