Executive Dossier · EU–Mercosur Secondary Raw Materials

European recyclers, traders and consultancies have started asking Brazilian operators for e-waste and magnet-bearing scrap. The commercial question for a European buyer is not whether Brazil has volume. It does. The question is whether a specific Brazilian lot can arrive with evidence the buyer can read, trust and defend to its own auditors, lenders and regulators. On most lots today, it cannot.

This dossier summarises the hub record of the EU–Mercosur Secondary Raw Materials Evidence Series (DOI 10.5281/zenodo.23689427). It is methodology and reference, not legal, customs or tax advice, and not a compliance determination for any party.

Why the question reached the buying desk

Three movements converged in 2025–2026, each documented in a primary source.

The EU pull

The Critical Raw Materials Act, Regulation (EU) 2024/1252, sets a 2030 benchmark of 25% of annual EU consumption of strategic raw materials from recycling. Rare earth elements for permanent magnets are on the strategic list.

The disclosure duty

Article 29 requires producers of listed products containing more than 0.2 kg of permanent magnets to publish the share of rare earths recovered from post-consumer waste, from 24 May 2027 or two years after the delegated act, whichever is later. A published share needs a documented source.

The shipment rules

Since 1 January 2025 all e-waste crosses borders under Basel prior informed consent. Since 21 May 2026, shipments into the Union are governed by Regulation (EU) 2024/1157.

European recycling capacity is being built ahead of documented feedstock. The interim EU–Mercosur trade agreement, provisionally applied since 1 May 2026, adds a trade channel. It does not add provenance.

What Brazil actually documents

The Global E-waste Monitor 2024 records 2,443 kt of e-waste generated in Brazil and a documented formal collection rate of 3%. For a European buyer, the Brazilian market therefore has two layers: a small documented layer and a large undocumented one whose provenance cannot be rebuilt after the fact. The commercial value of a Brazilian supplier lies in proving that a given lot belongs to the first layer.

One structural point is often missed. The Brazilian domestic documentary chain, transport manifest (MTR) to Certificate of Final Destination (CDF), ends at the port for exports: the export manifest issues no CDF. A Brazilian CDF does not evidence what happens to exported material. Proof of final destination for an exported lot rests on the Basel documents and the recovery facility's certificate.

The gap, defined

The gap is not a missing law. Each of four layers is regulated. What is missing is a single verifiable trail that connects them for a specific lot:

  1. Recycled status and provenance. That the material is genuine post- or pre-consumer waste from identified generators, not relabelled primary material or laundered stock.
  2. Lawful transboundary movement. Basel consent from Ibama and the EU authority of destination, correct waste code, contract, financial guarantee, movement document and certificate of recovery.
  3. Data and liability control. That data-bearing devices were sanitised or destroyed before leaving the generator's control, with records per device under Brazil's data protection law (LGPD).
  4. Buyer-side disclosure fit. Data that supports the buyer's own obligations: recycled-content shares, origin of waste and due diligence records requested by in-scope customers.

Pricing the gap before contracting

A buyer can put a number on missing evidence before signing. The series proposes an expected evidence cost per lot. Every input requires the buyer's internal data; no default values are implied.

Expected evidence cost per lot (EEC)
EEC = V × pr + Ctb × pil + D × cd + Cdd

V: contracted lot value · pr: probability of rejection or hold · Ctb: take-back and disposal cost · pil: probability of an illegal-shipment finding · D: expected delay in days · cd: daily cost of capital, storage and penalties · Cdd: cost of due diligence performed.

Decision rule: proceed only if expected margin minus EEC is positive and pil has been reduced, through documented controls, to a level the buyer's risk policy accepts.

In practice, documented provenance mostly reduces pil and D. On small first lots, where volume cannot absorb a take-back, those two terms dominate the decision.

What this means for each side

European buyers and recyclers

Treat Brazilian secondary feedstock as an evidence-qualified input, not a commodity. Score the supplier and the lot before the price discussion, and budget for the evidence work as part of landed cost.

Brazilian suppliers

The asset is not tonnage. It is the verifiable link between generator, equipment, data destruction and destination. Requests for "sell us material" without consent planning or provenance requirements are a risk signal, not an opportunity.

Boards and lenders

A recycled-content claim or a sourcing route built on undocumented feedstock carries disclosure and reputational exposure that will surface in the buyer's own reporting, not at the border.

How the series closes the loop

The hub frames the exposure. Five companion records turn it into working tools: shipment legality (EMS-02), a 41-question origination protocol (EMS-03), the trade agreement scope (EMS-04), an operational chain-of-custody case from Brazil (EMS-05) and the BSF-ERI readiness score (EMS-06). All six are listed with their DOIs on the EU–Mercosur Secondary Raw Materials Evidence Series page.

Assessing a Brazilian secondary feedstock supplier? Send the supplier file or the buyer request you are working on through the scope assessment. We apply the EMS-03 protocol and the BSF-ERI score and return the priority evidence gaps and the recommended next step.

Source record: Villanova, M. (2026). The EU–Mercosur Secondary Feedstock Evidence Gap. Zenodo. doi.org/10.5281/zenodo.23689427 · Primary sources cited in the record include Regulation (EU) 2024/1252, Regulation (EU) 2024/1157, the Basel Convention e-waste amendments (BC-15/18), Portaria MMA 280/2020 and the Global E-waste Monitor 2024. Status as at 27 October 2026.