Will Brazil Destroy the Amazon to Save the Climate?

Whether it was gold, diamonds, or iron, the history of Brazil has been shaped for centuries by the hunt for minerals. Colonial fortune hunters and their legions of pick-and-pan-wielding slaves dredged up 800 to 850 tons of gold in the 18th century alone, filling the coffers of the Portuguese crown. In the early 1800s, gold financed the war chest of the Brazilian independence movement.

The search for minerals expanded in the 20th century, turning Brazil into a mining colossus. The country still draws waves of “adventurers, madmen, and starvelings,” as French anthropologist Claude Lévi-Strauss called prospectors. Many scour the Amazon for paydirt, so much the worse for the world’s largest rainforest and the Indigenous communities that depend on it for survival.

But the coming treasure hunt may trump them all. The 21st century’s prizes are cobalt, lithium, nickel, niobium, and the other critical strategic minerals of which high-tech gadgets and green energy technology are built. To produce an equal amount of power, photovoltaic generation consumes 40 times more copper than fossil fuel combustion and wind power up to 14 times more iron, according to a forthcoming Igarapé Institute report. To meet the burgeoning global demand for green energy technologies—including a massive switch to electric batteries—the World Bank estimates that 3 billion tons of critical strategic minerals will be needed by 2050.

That this scramble for resources is centered on the Amazon lays bare an uncomfortable truth: Climate policy and environmental protection are not the same thing, and as the energy transition gathers pace, that trade-off is becoming increasingly evident. Indonesian rainforests have been cleared for palm oil plantations producing biofuels, and West African forests are felled for wood pellets to heat green homes in Europe. Open-pit mining is one of humanity’s most ruinous industries, razing everything in its path—while toxic runoff, tailings, and waste products can poison rivers and wreak havoc for miles.

How Brazil handles the energy transition’s burgeoning hunger for resources will help determine whether our policies to save the planet will leave us with a planet left to save.

Owing to its vast expanse and favorable geology, Brazil is exceedingly well endowed with highly valuable critical minerals. It sits on 94 percent of the world’s niobium, a bright, white metal crucial to strengthening steel; 22 percent of all graphite; and 16 percent of known reserves of rare-earth metals. The latter comprise 17 scarce elements, many of which are indispensable for clean energy and other technological hardware.

Right now, most of these mineral deposits are still in the ground. Brazil is not yet mining enough of them to even rank among the world’s major producers of strategic minerals or rare earths. That could soon change, driven by rising global demand and Brazil’s centuries-old engineering and geological acumen—after all, it was independence hero and mineralogist José Bonifácio who discovered lithium. Brazil already mines 70 minerals, worth $62 billion in 2021. And whereas Asia’s and Africa’s potential is comparatively well known and researched, much of Brazil’s critical mineral bounty has yet to be mapped.

Critical minerals bring the promise of fabulous wealth but also a bevy of existential challenges. One is the peril of abundance: Like oil does in petrostates, critical minerals could flood the economy with gushers of cash and its corruptive effects. New mines could also deepen Brazil’s dependence on trading raw materials, which already account for some 64 percent of exports. In 2021, only 2 percent of Brazil’s exports were high-tech goods, compared with 12 percent in 2000.

But the most consequential dilemma is how to unearth, refine, and ship these valuable assets without razing forests, eroding biodiversity, and devastating Indigenous and riverine communities. Close to one-third of Brazil’s critical minerals wealth—including one of the world’s largest deposits of rare earths—lies cached beneath the Amazon Basin. The region has scant infrastructure and public institutions to manage conflicts or tensions arising over resource competition. Official data shows that close to 15 percent of known deposits lie in protected conservation areas across Brazil and more than 4 percent within Indigenous lands.

Clearly, no government can forgo a mother lode, especially when the world is scrambling for these resources. Consider that to achieve the climate goals in the 2015 Paris Agreement, the world will need to quadruple—yes, quadruple—mineral production through 2040, according to the International Energy Agency. Surging demand will especially affect Latin America, which has 40 percent of global copper reserves as well as a large share of the world’s cobalt and nickel. Just three countries—Argentina, Bolivia, and Chile—control two-thirds of the global supply of lithium. The pressure to mine rare earths will grow as well, especially as China, the world’s largest producer, moves to restrict exports and as other countries work to lessen their strategic dependence on Beijing.

How Brazil manages a vast expansion of its mining industry and handles the attendant environmental, social, and other negative consequences could therefore shape the rules and red lines of an expanding global mining sector for years to come.

Then-Brazilian President Jair Bolsonaro sought to boost the mining sector in 2021 with his landmark Pro-Strategic Minerals Policy. This was a marquee initiative of the country’s public-private investment program, which holds that government entities have a duty to expedite priority investments. It gives the government discretion to waive regulatory restrictions designed to protect the environment and Indigenous communities if the project is deemed to be in the “national interest.” The gates were opened to fast-tracking critical minerals exploration and mining permits.

It was a policy of dig, baby, dig. Environmental preservation was never a priority for Bolsonaro and his backers, who mostly saw the rainforest and its Indigenous inhabitants as speed bumps to progress. Unsurprisingly, the Bolsonaro government greenlit 19 of the 26 critical minerals projects it vetted between 2018 and 2022. Many of these were in the so-called Legal Amazon, a Brazilian region already besieged by deforestation and degradation.

Even before he took office in January 2023, President Luiz Inácio Lula da Silva vowed to rewrite the script. He pledged to make the Amazon the centerpiece of Brazil’s green reset while also committing to prioritizing the search for vital minerals. Lula talked up mining in recent meetings with both the United States, which wants exclusive access to some of Brazil’s critical minerals, and China, which is hoovering up raw materials from everywhere. Whether Brazil will be able to lock in a good deal without mortgaging the rainforest to global superpowers is another matter. How Lula finesses those competing demands may shape the direction of the global green energy transition.

To be sure, Lula cannot escape the trade-offs that come with wanting to accelerate mining of critical strategic minerals on the one hand and protect the rainforest and its people on the other. At a minimum, his administration will need to uphold its promises to reinstate environmental and Indigenous rights protections dismantled during Bolsonaro’s tenure. This will be challenging, not least since ambitious mining projects could exacerbate simmering tensions. According to the Environmental Justice Atlas, roughly 4.5 percent of reported environmental conflicts worldwide already occur in Brazil.

Moreover, tightening oversight, enforcement, and compliance could also stimulate the illicit minerals market, where organized crime, dark money, and violence already abound. Even more worrisome, extracting and processing critical minerals and rare earths can exact a heavy environmental toll, from releasing carbon dioxide stored in the subsoil to spilling toxic mercury used to amalgamate gold into the rivers and food chain. Limiting these effects will be especially difficult in the vast Brazilian Amazon, an area that has long been troubled by poor governance and outright lawlessness.

More positively, Lula seems intent on reinstating the regulations and consultation processes that his predecessor weakened or scuttled outright. Ratification of the Escazú Agreement, signed by Brazil in 2018, would go a long way to institutionalizing these protections, including safeguarding environmental defenders and Indigenous peoples in the Amazon.

Efforts are also underway to lock in private sector commitments to the terms of a new green deal in Brazil. Some forward-looking investors are already on board: They increasingly recognize that cutting corners to fatten the bottom line is a corporate own-goal, especially in an era when corporations face pressures from activist investors and the public to adhere to environmental, social, and governance standards. What’s more, big-ticket projects that fail to benefit local populations are a common driver of social unrest, with protests halting mining operations or slowing new developments. In fact, one of the chief reasons large mining companies are hesitant to engage in early-stage exploration and extraction in the Amazon is that they want to avoid conflict with local communities.

Nevertheless, holding the country’s mining giants to account is a work in progress. Brazil’s five largest prospectors all produce lucrative critical minerals such as gold, copper, manganese, niobium, and uranium, which guarantee Brazil a reliable trade surplus. Mega-miner Vale last year signed a long-term agreement to supply nickel to Tesla, while Anglo American CEO Duncan Wanblad has called for Brazil to open up its mining sector to meet surging global demand.

Encouragingly, private operators are also increasingly facing growing pressures to do good while doing well. Last December, for example, Canada-based Indigenous groups and supporters launched the Sustainable Critical Minerals Alliance, calling on countries to protect against unsustainable mining in the Amazon by honoring their agreements to safekeep at least 80 percent of the river basin by 2025.

Ultimately, that decision will fall to Brazil. If the country manages to create productive strategies for delivering both wealth and well-being, this land of prospectors has a shot at reinventing the rules for sustainable, socially responsible enterprise and its own history as well.

Nicholas Pope contributed to this article. He is a postdoctoral research fellow at King’s College, a consultant to the Igarapé Institute, and a co-author of a forthcoming report on critical minerals in Brazil.