A Brazilian political party has petitioned the Supreme Court to suspend the $2.8 billion sale of Serra Verde Group to USA Rare Earth Inc, citing national security concerns. Rede Sustentabilidade, a left-wing party, argues that the deal risks transferring control of strategic mineral assets without adequate constitutional safeguards.
In a filing submitted on April 23, 2026, the party claimed that Brazilian legislation fails to protect national interests in the exploitation of critical resources. They contend that no transaction should proceed if it could directly or indirectly shift significant economic control over such assets to foreign entities. Serra Verde’s Pela Ema operation in Goiás, central to the deal, is a key producer of rare earth oxides, currently outputting 100 metric tons per year.
The proposed acquisition, one of the largest in the rare earths industry to date, involves a mix of cash and stock from USA Rare Earth. The US firm aims to secure a foothold in Brazil’s growing rare earths sector, which is pivotal for technologies ranging from electric vehicles to defense systems. Serra Verde’s output is slated to ramp up dramatically, with production expected to reach 6,400 tons annually by the end of 2027.
Neither Serra Verde nor USA Rare Earth has issued a public response to the legal challenge as of the latest updates. The silence from both companies leaves the market guessing about the potential fallout if the court sides with Rede Sustentabilidade. Brazil’s rare earths sector has drawn increasing global attention amid rising demand for critical minerals, making the outcome of this case a potential precedent for future foreign investments.
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The Pela Ema mine’s expansion plans underscore its strategic value, with output set to increase more than sixtyfold in under two years. This growth trajectory positions Serra Verde as a linchpin in the global supply chain for rare earths, amplifying the stakes of the Supreme Court’s impending decision.
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