en.Wedoany.com Reported - Brazilian President Luiz Inácio Lula da Silva delivered a speech on June 30, 2026, at the 68th Summit of Heads of State of the Southern Common Market (Mercosur) member and associate countries in Asunción, Paraguay, calling for joint action among Mercosur member states to develop a regional industrial chain for critical minerals. Lula positioned critical minerals as a "national security issue," emphasizing that South American countries should enhance their position in the global critical minerals competitive landscape by developing high-value-added regional production chains.

In his speech, Lula stated that Brazil "will continue to advance the connection of our continental interior with the ports of the Pacific, Atlantic, and the Caribbean" and advocated for treating critical minerals as a "national security issue" to "develop regional industrial chains with value-added links." The core objective of this proposal is to attract investment in stages such as beneficiation, refining, component manufacturing, and industrial development. Lula has repeatedly stressed that Brazil does not wish to merely serve as a commodity exporter but is committed to achieving local processing of mineral resources. He has clearly stated that Brazil is open to investments in its mineral processing industry from all countries, including China, the United States, Germany, Japan, and France.

Brazil has recently introduced a series of policy initiatives in the critical minerals sector. In early May 2026, the Brazilian Chamber of Deputies passed a bill establishing a national critical minerals policy, which includes the creation of a 2 billion Brazilian Real (approximately $370 million) guarantee fund and 5 billion Brazilian Real (approximately $920 million) in tax credits over five years to support the domestic mineral processing industry. The bill is currently under review in the Senate. In February 2026, Brazil signed a critical minerals cooperation agreement with India. Additionally, Brazil signed the Mercosur-European Union trade agreement with the EU on January 9, 2026, which is expected to consolidate Brazil's position as a strategic supplier of critical minerals such as lithium and rare earths.

Lula's proposal has elicited mixed reactions within Mercosur. According to reports, Mercosur member states have not yet reached a consensus on critical mineral extraction, and leaders are divided on issues such as relations with the United States. Nevertheless, the Lula administration has made its stance clear: Brazil can sell minerals to the United States, China, or Europe, but "processing is here, refining is here." Analysts point out that the Lula administration is promoting a collaborative framework of "foundational large models plus industry-specific small models," aiming to foster a unified stance among South American countries in the context of great power competition by positioning critical minerals as a national security issue.