In July 2022, the government of Brazil\u2019s then-president Jair Bolsonaro issued a decree<\/a> removing restrictions<\/a> on the country\u2019s lithium\u2019s trade. Until then, exports of the mineral had been restricted due to a 1997 regulation designed to protect the Brazilian nuclear industry, in which lithium was mainly used to power reactors.<\/p>\n\n\n\n Brazil\u2019s opening up to foreign trade in lithium has attracted both domestic and international mining companies. Requests made to the federal government to research and explore for the mineral in the south-eastern state of Minas Gerais \u2013 where over 80%<\/a> of Brazil\u2019s known lithium deposits are located \u2013 jumped almost 18 times in just two years, from 45 in 2021 to 851 in 2023, according to a survey conducted by the Minas Gerais-based Federal University of the Jequitinhonha and Mucuri Valleys, seen by Dialogue Earth.<\/p>\n\n\n\n However, analysts tell Dialogue Earth that while lithium exports from Brazil are taking place, these are not adding value within the country, limiting the opportunities to develop domestic industries around the mineral. <\/em>They also warn that the increase in demand is being accompanied by socio-environmental harms, especially for communities whose traditional ways of life are already being eroded.<\/p>\n\n\n\n Estimates for Brazil\u2019s lithium reserves vary widely. In 2017, the Brazilian Geological Survey, which is linked to the Ministry of Mines and Energy, projected<\/a> that the country could be home to 8% of global lithium reserves. However, this year, the US Geological Survey determined<\/a> that Brazil hosts less than 1% of the world\u2019s potential stocks.<\/p>\n\n\n\n These estimates are significantly lower than that of its neighbours in Latin America\u2019s so-called \u201clithium triangle\u201d, whose members Bolivia<\/a>, Argentina<\/a> and Chile<\/a> collectively sit on more than 50%<\/a> of global reserves of the mineral. Nonetheless, Brazil\u2019s authorities are harbouring grand ambitions for its reserves.<\/p>\n\n\n\n In May 2023, the governor of Minas Gerais, Romeu Zema, announced<\/a> his intention to develop a technology centre in the state as part of the Vale do L\u00edtio (\u201cLithium Valley\u201d) project. This hub would be developed in the Jequitinhonha Valley, in the state\u2019s north-east, which is also facing the prospect of being targeted for massive iron ore exploitation<\/a>.<\/p>\n\n\n\n The region has previously been dubbed<\/a> the \u201cvalley of hunger\u201d due to socioeconomic deprivation among its mostly rural population. But Zema, who launched the programme in New York in a move to attract foreign investors, said he hopes the region \u201cwill become a \u2018technology valley\u2019 for the production of batteries and other value-added products\u201d.<\/p>\n\n\n\n The Minas Gerais government told Dialogue Earth that it had formed a working group with executive bodies and private entities to develop the programme. Its aim is to enhance the region, create more than 10,000 jobs and generate income in 14 cities, with an investment that could reach BRL 30 billion (USD 5.4 billion) by 2030.<\/p>\n\n\n\n Several companies are already operating or want to operate in the state. They include Companhia Brasileira de L\u00edtio (CBL), which has been mining in the Ara\u00e7ua\u00ed and Itinga municipalities since 1991<\/a>, and Canada\u2019s Sigma Lithium, which has been operating in the same municipalities<\/a> since April 2023. In Nazareno, in the central region of Minas Gerais, Dutch company AMG is extracting lithium from mining tailings<\/a> and building a plant that is scheduled to open<\/a> in 2026.<\/p>\n\n\n\n Meanwhile, several foreign companies are awaiting clearance from the federal government to develop projects in the Jequitinhonha Valley, including Canada\u2019s Lithium Ionic, Australia\u2019s Latin Resources, and Atlas Lithium Brasil, a subsidiary of US-based Atlas Lithium. Prospecting requests<\/a> have also been made in other states.<\/p>\n\n\n\n Some observers, however, are critical of the means of exploitation, which they say is not boosting Brazilian industry.<\/p>\n\n\n\n \u201cIn Jequitinhonha, even with strong support from the state government, there is no initiative to add value [to production],\u201d says T\u00e1dzio Peters Coelho, a social sciences professor researching lithium at the Federal University of Vi\u00e7osa.<\/p>\n\n\n\n Coelho claims that the state government only gives political support to production, exploiting the idea of poverty and backwardness to preach a development perspective for the area. \u201cBut it\u2019s just a way of facilitating the approval of projects without major obstacles,\u201d he says.<\/p>\n\n\n\n In Brazil, exploration of the critical mineral is poorly planned, according to Marina Oliveira, who researches lithium and associated inequalities at the Pontifical Catholic University of Minas Gerais.<\/p>\n\n\n\n \u201cThere is no solid policy that benefits the entire production chain,\u201d says Oliveira. She suggests that the government consider aspects such as \u201cthe contribution of technology, the creation of skilled jobs, the production of electric cars\u201d, in a way that advances industrialisation, but also respects local inhabitants.<\/p>\n\n\n\n This model for developing regional industry would be very different from \u201cjust extracting lithium and selling it very cheaply\u201d, as is the case today, Oliveira adds. She claims the Vale do L\u00edtio project only serves to attract investors.<\/p>\n\n\n\n The list of parties interested in entering Brazil\u2019s lithium industry includes big names in the global EV industry. In January, the Financial Times reported<\/a> that China\u2019s BYD, the largest global electric car manufacturer, held talks on a \u201cpossible supply agreement, joint venture or acquisition\u201d of Sigma\u2019s Brazil operations, which Sigma declined to comment on. German carmaker Volkswagen has expressed<\/a> similar interest in a bid to reduce dependence on China for its EV components.<\/p>\n\n\n\n At the latest edition of annual technology event Web Summit, this time held in Rio de Janeiro in April, the president of BYD Brazil, Tyler Li, expressed the company\u2019s desire to ensure an integrated production chain in order to offer lower prices to local consumers. Today, the high cost<\/a> of EVs is one of the main bottlenecks in this market.<\/p>\n\n\n\n \u201cIn Brazil, we have the best benefits. We have almost everything: we have lithium, we have iron, we have aluminium, we have all the raw materials,\u201d Li said at a panel discussion on the growth of the country\u2019s EV industry. \u201cThat\u2019s a good incentive for us to build the whole supply chain in Brazil. That could reduce costs a lot.\u201d<\/p>\n\n\n\n As part of this strategy, BYD is building<\/a> its largest EV factory outside Asia in Cama\u00e7ari, in the north-eastern state of Bahia, which is scheduled to start operating in early 2025. This is one of several recent investments that could turn Brazil into a hub<\/a> for the sector in Latin America.<\/p>\n\n\n\n For Elaine dos Santos, a researcher at the Institute of Advanced Studies at the University of S\u00e3o Paulo, the trend could bring benefits to the country: \u201cThis would have a direct impact on industry, on job creation and on reducing foreign dependency by improving the supply of parts.\u201d<\/p>\n\n\n\n Sigma has touted the production of \u201c<\/a>green lithium\u201d<\/a> from its operations in the Jequitinhonha Valley, claiming<\/a> to exploit a product with \u201czero carbon, zero coal power, zero tailings dam, zero utilisation of potable water and zero use of hazardous chemicals\u201d. Local residents, however, dispute the truth of this term.<\/p>\n\n\n\n Unlike the lithium extraction from brine pools seen in South America\u2019s \u201clithium triangle\u201d, Brazil\u2019s deposits are mostly found in hard rock, which requires more conventional digging and blasting. On the banks of the Jequitinhonha River, inhabitants of the village of Cinta Vermelha de Jundiba are feeling the consequences of such processes.<\/p>\n\n\n\n The community, home to the Pankararu and Patax\u00f3 ethnic groups, is about 10 kilometres from the Grota do Cirilo mine, where Sigma began extracting lithium just over a year ago. Here, villagers are a short distance from the dust, noise and pollution of the mines.<\/p>\n\n\n\n \u201cWhen dynamites explode, the air is contaminated; there is an intense emission of dust, and the pollutants travel through the wind. There are also vibrations from the noises,\u201d says local leader Cleonice Pankararu.<\/p>\n\n\n\n With the mining activity, \u201cthere is the destruction of the Cerrado and Caatinga biomes; there is a social and economic impact, with a change in the landscape, our culture and our religions\u201d, she adds. \u201cOur rituals depend on a balanced environment.\u201d<\/p>\n\n\n\n Pankararu says she has also noticed changes as more urban development has arrived, particularly in prices in Ara\u00e7ua\u00ed, which have reportedly increased following the arrival of labourers involved in the mining operations. The small room her family used to rent in the city for their children to sleep in during the school week no longer fits their budget. She says she has also observed increases in violence, such as physical attacks, theft and sexual assault since the arrival of workers.<\/p>\n\n\n\n Aline Gomes Ruas, from the Ara\u00e7ua\u00ed chapter of the Movement of People Affected by Dams, an environmental campaigning group, claims that Sigma\u2019s activity has caused instability in the community of Piau\u00ed Po\u00e7o Dantas in Itinga, 8 kilometres south from the mine. Its residents, she says, are trying to learn to live with the many new impacts.<\/p>\n\n\n\n \u201cFor more than a year, the community hasn\u2019t known what to do, amid so much noise and dust,\u201d says Gomes Ruas. \u201cThe rubble and dust fall into the river, which is no longer the same, as well as on the vegetation and crops. What used to be produced is no longer produced.\u201d<\/p>\n\n\n\n Gomes Ruas says that people in the community now suffer from respiratory problems as a result of dust from the mining operations, and that blasts from the mine have caused cracks to form in the walls of their houses. She claims Sigma does not recognise its responsibility for these problems. The company did not comment on the issue.<\/p>\n\n\n\n In Nazareno, Coelho claims the impacts of AMG\u2019s lithium mining are similar to those of traditional mining, with the mineral\u2019s production entailing the construction of dams<\/a>, which flood large areas and pose potential risks of collapse, as well as requiring sites for the disposal of polluting materials. AMG also did not comment.\u00a0<\/p>\n\n\n\n There are also fears that lithium mining will have negative effects on other cities in the state. Luiz Paulo Guimar\u00e3es, from the Popular Sovereignty of Mining Movement, says he is worried about the municipality of Salinas, where the Australian company Latin Resources Limited is set to invest<\/a> in two prospecting areas. The area is known for production of cacha\u00e7a<\/em>, a popular Brazilian distilled spirit made from sugarcane juice.<\/p>\n\n\n\nDreams of lithium<\/h2>\n\n\n\n
![\"A](\"https:\/\/dialogue.earth\/content\/uploads\/2024\/07\/20240705_-Governor-Romeu-Zema-takes-a-selfie-at-a-port_Cristiano-Machado_Imprensa-MG.jpg\")
<\/div>Questions over planning<\/h2>\n\n\n\n
Foreign firms advance in Brazil<\/h2>\n\n\n\n
Dust, noise and cracks<\/h2>\n\n\n\n
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