Jair Bolsonaro's anti-environment rhetoric has led to the collapse of initiatives like the Cerrado Mechanism and Soy Moratorium to hold the line on deforestation, but civil society and progressive companies in Brazil are fighting back. Mark Hillsdon reports
Last year was a difficult one for Brazil. The world looked on as fires ravaged the Amazon, while Jair Bolsonaro’s populist government slashed funding for environmental protection and sacked the head of Brazil’s space agency for publishing satellite images that showed the extent of the Amazon’s demise.
The resultant surge in land clearance led to both Germany and Norway suspending payments to the Amazon Fund, while individual companies took action too. H&M, for instance, abandoned Brazilian leather, while Nordea, the largest financial group in Northern Europe, suspended the purchase of Brazilian government bonds.
The implications for the planet were underlined by a recent report in Nature magazine that the Amazon could flip from being an absorber of CO2 to a source of emissions as early as the mid-2030s due to escalating forest loss and slow growth.
The president has whipped a populist support against interfering NGOs, while billing zero deforestation as a neo-imperialistic manoeuvre'
“Under Bolsonaro, soy farm associations have been emboldened,” says David Cleary, director of agriculture at The Nature Conservancy (TNC), adding that the president has “whipped a populist support against interfering NGOs [while billing] zero deforestation as a neo-imperialistic manoeuvre.”
Last year also saw the collapse of work on the so-called Cerrado Mechanism, a financial scheme that would have compensated farmers for foregoing legal rights to converting forests, says Cleary.
The mechanism had grown out of the Cerrado Manifesto, a 2017 agreement that created a coalition between civil society and businesses that purchase soy and beef from the Cerrado to eliminate deforestation and end any contracts with producers using recently converted natural areas. Etelle Higonnet from the NGO Mighty Earth says the mechanism was sabotaged “by some of the most retrograde elements in the Brazilian soy industry”.
“The idea that there could be some broad, biome-level agreement in the Cerrado, I think that's off the table for now,” continues Cleary. “There has been a scaling down of ambitions,” with people now more concerned about “preserving what they've got, rather than trying to make advances”.
Initiatives such as the Soy Moratorium, an agreement not to utilise newly deforested land for soy, signed by companies including Cargill, Bunge and Amaggi, along with NGOs such as Greenpeace, have also come under sustained attack from both government and producers, says Cleary, while Higonnet points to attempts to kill off the Brazilian Soy Working Group (GTS), which over the last decade has helped to reduce deforestation caused by soy in the Brazilian Amazon from 30% to 1%.
“Not only did it [GTS] drive deforestation from soy down unbelievably well but also productivity went up and profitability went up ... it was such a win-win,” Higonnet says.
There is a huge contingent of Brazilian business, media and civil society that do not agree with what's happening
Yet despite the attacks and the rhetoric, there is still hope, she says. The Coalizao Brazil (Coalition Brazil), for instance, has brought together businesses, academics and NGOs to keep the worst excesses of Bolsonaro in check.
“There is a huge contingent of Brazilian business, and media and civil society that do not agree with what's happening and that's trying to stop it,” Higonnet says.
The coalition represents 21% of the economy, and had enough clout to convince the government that it would be economic folly to pull out of the Paris Agreement, she continues.
Many Brazilian agri-companies are also involved, explains Higonett. “Some Brazilian agri-businesses are among the most sophisticated in the world [and] there's almost like a war between the more progressive and the more retrograde companies. Their financial future is hitched to being attractive to the new demands of the market, and that the market wants deforestation-free products.”
Cleary also sees reasons for optimism, particularly in the new generation of farmers who see the sustainability of their farms as crucial to their future livelihoods.
“Farmers migrated to and planted these areas in the 80s and 90s and now their children are beginning to take over,” he says. This second generation of farmers are looking to intensify production rather than expand it geographically; and manage their soils better with better cropping.
There is a deep cultural shift going on that in the end is going to work in favour of sustainable approaches to soy production
“If you're a soy farmer, it makes much more sense for you to be expanding over land that's already been cleared – closer to a road, transport costs are lower [and] environmentalists are going to leave you alone.
“There is a deep cultural shift going on that in the end is going to work in favour of sustainable approaches to soy production.”
Cleary sees huge opportunities for the ag-input sector to develop products that can help farmers to improve the fertility of degraded land.
“It's the kind of market-driven, positive change that we really like to see,” he says. “It's a genuine business opportunity but also dovetails really well to their pre-existing sustainability policies… (and) helps the soy sector move towards zero deforestation.”
While agro-chemical giants such as Bayer are often mired in controversy, for instance, the recent Greenpeace exposé that they were among a cartel of companies selling chemicals and pesticides in Brazil that are banned in Europe, their efforts around deforestation are having a more positive impact on the landscape.
“We don't need to advance agriculture and open new frontiers,” says Alessandra Fajardo, Bayer’s Latin America environment and agriculture strategy lead. “Our priority is to focus on helping farmers really boost crop yield and productivity while ensuring environmental protection.”
When you're looking at solutions around sustainability in soy, you're going to have to almost by definition, go beyond certification
Bayer’s portfolio of solutions for farmers includes access to varieties of soy that are suited to the climate or region, and techniques that can help transform degraded pastureland, from improving soil quality with fertilisers and organic matter, to the use of digital technology to allow agro-chemcials to be applied more accurately and sparingly.
For years, international buyers and retailers have looked to certification as the way to halt Brazil’s deforestation, but efforts to make soy supply chains sustainable have lagged behind other commodities such as palm oil, to the extent that certified soy makes up just 0.2% of the market (compared to the 20% market share of certified sustainable palm oil).
The Round Table on Responsible Soy (RTRS) points to a 41% rise in the sale of certified soy in 2019, to 4 million tonnes, which it describes “as a clear sign (of) a global increasing trend”. However, the fact that China alone imported over 88 million tonnes of soy last year puts the figure into context.
Certification is “never going to be able to move the needle, given the limited market penetration,” says Cleary. “When you're looking at solutions around sustainability in soy, you're going to have to, almost by definition, go beyond certification.”
It’s a view echoed by Daniel Salter, responsible sourcing manager (forests) at Tesco. “Certification is an important starting point for tackling these commodities but we know they're not sufficient enough to end deforestation any further than your own supply chain,” he says.
Tesco, which launched its zero-deforestation soy transition plan in July 2018, is now looking for new ways to stop the clearance of forests. At the end of last year it announced a £10m contribution to the Funding for Soy Farmers in the Cerrado initiative, designed to help protect native vegetation by transitioning to soy production on existing agricultural land.
We have a role to play beyond what the government requires; that's where our financial incentives to farmers in the Cerrado comes into it
Tesco has been working in partnership with the WWF, and believes that around £250m is needed to fund an effective financial mechanism that could incentivise farmers not to deforest, despite their legal right to do so, says Salter.
Over the last two and a half years, 150 of the world’s biggest food companies and investors have signed the Cerrado Manifesto’s Statement of Support, and Salter now wants more to come forward and support the new funding strategy.
“At the heart of the statement of support is effective industry-wide action,” he says, with animal nutrition business Nutreco, and Grieg Seafood, already signing up.
“We have a role to play supporting action beyond what the government requires; that's where our financial incentives to farmers in the Cerrado comes into it.
“My hope is that we will be able to use it as a model for effective change in other landscapes across South American, and potentially other commodities,” he says.
Other companies looking to make a difference in the Cerrado include global food business the Archer Daniels Midland company (ADM). The company is one of the top five processors of soy in Brazil, and its commitments to traceability and dealing with delinquent suppliers saw it score highly in the recent Forest 500 report, although it lagged behind on other commodities, such as paper and pulp.
The pressure that the global community has brought to bear, especially the purchasers, has really had an impact
ADM is keen to find a “sustainable balance between agricultural production and conservation” explains chief sustainability officer Alison Taylor. ADM uses satellite technology to monitor over 90% of its producers in areas that are at the highest risk for deforestation in the Cerrado.
It is also “working to define common standards that will bring more transparency to the sector as a whole and searching for financial incentives that will protect forested areas and/or promote the use of previously cleared land,” she says.
Nestlé topped the list of soy buyers in the Forest 500 report, and a spokesperson said that over the past 10 years the company had developed an integrated approach that combines certification, supply chain mapping, on-the-ground verification and satellite surveillance, and which means that around 90% of its global key agricultural commodities could to be verified as deforestation-free by the end of 2020.
The company hasn’t been afraid to cut ties with companies that don’t share its stance on deforestation. A spokesman said Nestlé stopped sourcing Brazilian soy from Cargill last May “because of their inability to deliver traceable soya and because of recent changes on their policy regarding deforestation in Brazil.”
“The pressure that the global community has brought to bear, especially the purchasers, has really had an impact,” says Higonett.
She is also excited by comments made by Mars global director of sustainability Kevin Rabinovitch that “a group of high ambition companies in the Consumer Goods Forum are to start to drop suppliers, not based on the deforestation or problems directly in the chain from that supplier to the company, but based on their group-wide performance.” (See Deadline 2020: Big brands double down on efforts to source deforestation-free palm oil)
If CGF companies rate suppliers based on group-wide performance, 'you would finally start to see Bunge and Cargill and others get dropped'
If it happens, she says, “You would finally start to see Bunge and Cargill and others get dropped.” She said this is because such companies have a clean stream of deforestation-free soy in the Amazon, but also a “dirty” stream of soy that is contributing to deforestation in Bolivia in the Gran Chaco, and in the Cerrado.
“If major companies... start to source based on that, then I think we will clean up the suppliers who are engaging in indigenous rights abuses, land grabbing, [and] this epidemic of violence against environmental defenders and deforestation.”
Mark Hillsdon is a Manchester-based freelance writer who writes on business and sustainability for Ethical Corporation, The Guardian, and a range of nature-based titles including CountryFile and BBC Wildlife.
This article is part of our in-depth Deforestation briefing. See also:
TNC tesco Cerrado Mechanism Might Earth soy moratorium GTS Bayer Mars Nestlé WWF RTRS ADM Consumer Goods Forum Coalizao Brazil