The United States has committed $750 million to a government-backed structure designed to secure long-term supplies of mixed rare-earth carbonate from Serra Verde’s Pela Ema operation in Goiás, Brazil. The commitment is part of a broader $1.55 billion package combining government funding, a private-bank credit facility and a federal purchase commitment.
The initiative gives U.S. defense and industrial supply chains access to neodymium, praseodymium, dysprosium and terbium—four magnetic rare earths used in high-performance permanent magnets. It also fits a wider U.S. strategy to build a rare-earth supply chain outside China, from mining and separation through metals and magnet manufacturing.
Key Overview
- The U.S. Department of War committed $750 million through the Industrial Base Analysis and Sustainment program to support the Serra Verde offtake structure.
- A Tier-1 institutional bank committed up to $500 million in senior debt, while the U.S. government entered a forward-purchase commitment of at least $300 million over five years.
- The offtake agreement is designed to purchase 100% of Serra Verde’s Phase I production and includes floor prices for neodymium, praseodymium, dysprosium and terbium.
- Serra Verde expected the first deliveries under the arrangement to begin in early Q4 2026.
- Separately, Serra Verde secured up to $565 million in long-term financing to optimize and expand the Pela Ema operation.
A $1.55 Billion Supply-Security Structure
The $750 million commitment is being made with US SIIE, LLC through the Industrial Base Analysis and Sustainment program and supports the special-purpose vehicle created to purchase Serra Verde’s mixed rare-earth carbonate. Together with the $500 million bank facility and the $300 million government purchase commitment, the structure reaches $1.55 billion.
The arrangement goes beyond a conventional mining investment. The offtake secures Phase I output under a long-term framework, while guaranteed floor prices are intended to provide greater revenue certainty for critical magnetic rare earths. That combination of financing, demand guarantees and price support can help protect a strategic producer from the price volatility that has historically complicated investment in non-Chinese rare-earth projects.
Serra Verde said the special-purpose vehicle was capitalized and required to begin accepting deliveries, with the company expecting shipments to start in early fourth-quarter 2026.
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Why Serra Verde Matters to U.S. Rare-Earth Strategy
Pela Ema is a commercial-scale ionic-clay rare-earth operation in central Brazil producing neodymium, praseodymium, dysprosium and terbium. These elements are central to neodymium-iron-boron permanent magnets, with dysprosium and terbium commonly used as performance-enhancing additives in demanding applications.
The strategic concern is supply concentration. China accounted for about 60% of global mined production of magnet rare earths in 2024, roughly 91% of refined output and about 94% of sintered permanent-magnet production. That concentration creates exposure for industries that depend on high-performance magnets, including aerospace, defense, electric vehicles, wind power, robotics and data centers.
Pela Ema therefore offers Washington something difficult to replicate quickly: an operating, non-Asian source of all four major magnetic rare earths. Serra Verde entered commercial production in 2024 and is targeting roughly 6,400 tonnes of rare-earth oxides annually by the end of 2027.
Building a Wider Mine-to-Magnet Supply Chain
The Serra Verde package sits alongside other U.S. measures intended to expand rare-earth capacity beyond mining. Earlier in 2026, Serra Verde secured a financing package of up to $565 million to optimize and expand Pela Ema. Separately, U.S. industrial-policy support for USA Rare Earth has targeted a vertically integrated domestic chain spanning mineral extraction, rare-earth oxides, metals and neodymium-iron-boron magnets.
That downstream capacity is important because diversifying mine supply alone does not eliminate dependence on concentrated refining and magnet manufacturing. The emerging strategy increasingly combines allied mineral production, long-term offtake agreements, processing investments and domestic magnet capacity.
For defense supply chains, the result could be more predictable access to materials used in aircraft, submarines, missiles, satellites, drones and other advanced systems. For the broader economy, the same materials support electric motors, renewable-energy equipment, electronics and industrial automation.
The Serra Verde initiative therefore represents more than a large financing commitment. It is an attempt to lock in physical supply, stabilize project economics and connect a producing Brazilian resource to an emerging Western mine-to-magnet ecosystem.
Sources: U.S. Department of War / U.S. Securities and Exchange Commission / U.S. International Development Finance Corporation / International Energy Agency / National Institute of Standards and Technology / Serra Verde Group
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