Brazilian company Serra Verde has announced the start of commissioning of its first phase of mining at the Pela Ema rare earth deposit. 

The Pela Ema deposit is located west of Minaçu in Brazil and becomes the first new ionic clay (also known as ion adsorption clays) deposit outside southeastern Asia to be commissioned. The company plans to commission the project with an initial 5ktpy REO capacity with potential to expand to 10ktpy by the end of the decade.

Ionic clay mining for rare earth extraction has previously been limited to southern China, Myanmar and, most recently, Laos. The majority of illegal rare earth mining over the 2010s was sourced from ionic clay deposits in southern China, however, the clamping down on illegal production via environmental inspections and stricter production quotas for state-owned enterprises (SOEs) since 2016 saw production in China fall sharply in the late 2010s. The suspension of rare earth mining in southern China was quickly replaced by output in neighbouring Myanmar, with ionic adsorption clay deposits in the Kachin state of Myanmar having similar geology to ionic adsorption clay deposits in Yunnan province of China.

Rare earths sources from ionic clays are important for their higher ratio of heavy rare earths (HREE), such as dysprosium (Dy) and terbium (Tb). Dy and Tb are critical elements in neodymium-iron-boron (NdFeB) permanent magnets used in electric vehicle drivetrain motors, military applications and industrial robotics. The critical concern for the suite of 15 rare earth elements is that the relative supply of each element is more or less locked into its source mineral – currently largely determined by light rare earth (LREE) rich monazite and bastnaesite mined predominantly for its neodymium-praseodymium (Nd-Pr) content.

With a more limited pipeline of projects targeting HREE production, Project Blue forecasts a growing market deficit for key HREEs including Dy and Tb over the mid-to-late 2020s. We see technological developments in HREE loading in magnets and/or increased HREE-rich mineral sources as two important trends to allow NdFeB-based electric motors/generators to be sustained in energy transition technologies moving forward.