▼ The cattle sector has had a catastrophic impact on tropical forests. © 2021 Alliance Bioversity International & CIAT/ Juan Pablo Marin García
It’s no secret that the cattle sector has had a catastrophic impact on tropical forests. From 2001-2015, the cattle sector alone was responsible for replacing 45.1 million hectares of forest – more than the entire area of Sweden. Cattle are responsible for 16% of global tree cover loss – more than double the impact of oil palm and soy combined. Agricultural and livestock commodities companies have been feeling the heat from consumers and civil society groups. Investigations by, among others, Global Witness in 2020 and 2021 have claimed that some of the world’s leading agribusinesses and banks are linked to tens of thousands of hectares of illegal deforestation in Brazil, driven largely by expanding cattle ranches. According to a report by Brazilian NGO Imaflora, “stopping the conversion of rainforests into pasture for beef production could reduce Brazil’s agricultural carbon emissions by 69%”.
…stopping the conversion of rainforests intopasture for beef production could reduce Brazil’s agricultural carbon emissions by 69%.
At COP26 in November 2021, the governments of the United States and the United Kingdom, with support of the Tropical Forest Alliance (TFA) convened over a dozen of the world’s largest agri-commodity traders and processors to sign a commitment to develop a shared roadmap to tackle commodity-driven deforestation in their supply chains. This Roadmap was launched a year later at COP27 in Egypt. These companies, now numbering 14, have a collective annual revenue of around $500 billion and include two of Brazil’s largest meatpackers – JBS and Marfrig. All eyes are now on COP28 later this year, when signatories are expected to report on their progress. “This Agriculture Sector Roadmap is a really important step forwards”, says TFA’s Executive Director Jack Hurd, “because tackling a systemic issue like deforestation and conversion requires collective, aligned action by key market actors in each sector, and the traders are particularly important given their proximity to the farmgate.” The Roadmap has attracted criticism around its soy commitments, but its targets for the cattle sector in Brazil represent tangible progress. Beef producers have committed to eliminate both illegal and legal deforestation among direct and indirect suppliers in the Amazon by 2025. The two signatories have also agreed a target for no illegal deforestation in the Cerrado by 2025. However, this is less ambitious, given that under Brazil’s forestry code, landowners in the Cerrado can deforest up to 80% of their land legally, compared with 20% in the Amazon.
This Agriculture Sector Roadmap is a really important step forwards because tackling a systemic issue like deforestation and conversion requires collective, aligned action…
◀︎ Beginning the oil palm fruit harvest, Indonesia. © Icaro Cooke Vieira/CIFOR
To ensure compliance with these goals, each signatory company must publish a commodity-specific, time-bound plan clarifying its actions to remove forest loss and conversion from supply chains, and report annually and publicly on progress. The companies have also committed to set science-based emissions-reduction targets for land-use change, and to invest resources into transforming the sector towards forest-positive land-use management, alongside industry peers and governments. It won’t be easy though – to deliver on the Paris goals, emissions from food, land use and agriculture need to be halved by 2050, while over the same period food production is expected to increase by 50% to meet growing demand. A key challenge is to trace the origin of all these commodities back to the source, often through multiple tiers of suppliers. Brazil’s beef sector, for example, lacks a centralized system to trace animals. So most companies are left cobbling together information from a combination of sources, such as the Environmental Rural Registry (CAR) or inter-farm cattle transport data registered by the Animal Transport Guides (GTA).
All my work is based on the idea that we can produce not only beef but other agricultural products in a sustainable way in the Brazil context.
What is the view of the roadmap from one of the world’s leading beef-producing nations? Perspectives interviewed Fernando Sampaio, the sustainability director of ABIEC, a business association that accounts for 98% of all Brazil’s beef exports.
Q: Why is the Agriculture Sector Roadmap important?
All my work is based on the idea that we can produce not only beef but other agricultural products in a sustainable way in the Brazil context. We can increase production for both international and domestic markets and conserve the forest we have remaining – and we still have a lot of environmental assets to protect. The Roadmap shows how we can do that in practice. It offers a clear way for agribusiness to keep trading and contributing to global food security, while reducing the footprint of food production and conserving biodiversity in Brazil.
▲ Mato Grosso, Brazill. © Icaro Cooke Vieira/CIFOR
Q: How do you think the Roadmap will contribute to progress in reducing deforestation in commodity-driven supply chains?
The Roadmap is an indication for companies on which actions are important, it’s an implementation plan with clear goals and targets. It will help the producer landscape to transform itself, by showing us how to identify risk areas we are sourcing from, increasing traceability and supporting the ranchers. This is about the private sector saying: “I understand what my role is and this is what I’m committing to support.”
Q: How much of a step forward does this initiative represent? Is it ambitious enough?
Well of course, the companies were already moving in that direction. But the roadmap is a very good step from the companies because it is a catalyser of actions. We’re not only talking about accelerating individual measures – with the roadmap you have all these different companies working together on the same initiatives, so the impact on the ground can be a lot larger. From the farmers’ point of view, they are already responsible for conservation inside their private holdings, in line with Brazil’s Forest Code. But when we demand something that goes beyond the regulations, they complain that it’s a heavy burden because they already have to conform to the Forest Code. So if you go beyond that with zero deforestation, they expect some kind of compensation.
…how can we split this cost across the whole supply chain and make sure the farmers that contribute their information on traceability have an incentive to do so
Q: And who should pay that cost?
That is one of the challenges – how can we split this cost across the whole supply chain and make sure the farmers that contribute their information on traceability have an incentive to do so. Take the beef market for example. Cattle can move through maybe five different farms in their lifetimes. We are trying to create a system where, every time cattle move from one farm to another, each farmer provides information about the farm’s compliance with environmental and social criteria. But he must receive some value for providing that information – because currently the only guy getting the incentive is the last farmer in the chain selling to the meatpackers.
Q: What are the main challenges that companies face to improve their performance?
Traceability is a major part of the challenge for corporates. For a long time, people thought the whole point of commodities was that you didn’t need to define their origin. Now that’s changing. Traceability is about finding out which proportion of the commodity is coming from legitimate farmers, and what is coming from illegal sources. But think about petrol, for example – imagine if I drive to the gas station and say that I only want to fill up my car with petrol from the Emirates! There’s a technological challenge to tracing the origin of commodities and we need different models and systems. The monitoring systems that companies are now implementing in their supply chains are quite sophisticated and traceability is improving. So it’s possible, but it has a cost.
▲ Oil palm in local village in Brazil. © Miguel Pinheiro/CIFOR
Q: So how can we help the farmers – is it just about incentives?
The companies can help, for example if a farmer has an issue with the paperwork for compliance, the agribusinesses have technical staff to assist them. That’s already happening. The most important thing is to find a mechanism to support the farmers to be compliant. With these demands from the market, we’ve always been working on exclusion systems. If the farmer deforests, if he doesn’t have the right papers, he’s excluded from the supply chain. You even have the market excluding entire regions and countries. But if you keep excluding people, they will just create a parallel black market. We have to reduce the risks and bring farmers back into the supply chains. We have to change the exclusion system to an inclusion system.
Q: The Roadmap includes a goal for companies to measure, disclose and reduce their emissions from land-use change. How challenging will that prove?
It is still a challenge to measure emissions in production in reality. Take measuring the amount of carbon in soil or in tropical grasslands, for example – this is still expensive to do. Sometimes we need to develop locally specific standards. When it comes to reducing emissions, if you look at the beef supply chain, more than 95% of the emissions are from Scope 3. They’re not in the meatpacking companies but with the farmers. We do have a lot of good practices and technologies to help farmers to keep increasing their efficiency and reduce their emissions. But we come back to the same challenge of the gap in investment and technical assistance. We have to think of investment models that support farmers.
◀︎ Cattle, Orinoquía. © 2021 Alliance Bioversity International & CIAT/ Juan Pablo Marin García
Q: What are the limits for corporate action and what kind of support is needed from other sectors?
Well, when you look at what kinds of investments are needed to transform producer landscapes, it’s a huge amount of money. That can’t come from just one source of investment – we need rural credit from the banks, budgets from the government, international aid, grants from foundations, foreign direct investment and carbon finance. We need to look at how carbon credits and biodiversity credits can support farmers to conserve areas that they could legally deforest. There are some examples, such as the CONSERV project which is using grant money to pay farmers not to clear forest. The Roadmap needs to encourage more of this. And then there are a lot of things that need to happen that are outside the reach of supply chains. We need to work together with the government on a public traceability policy, for example. But the biggest challenge in Brazil is to control illegal deforestation. Illegal land-grabbing and timber extraction account for most of the deforestation on the agricultural frontier. The government needs to control that illegality, as well as working on land tenure issues. What this roadmap does is to bring together major businesses in the soy and beef sectors in a way that puts pressure on the government to take the actions needed to ensure that Brazil’s farmers can maintain their market access.
Q: Are you optimistic about the future?
Yes, I am positive about it, because what’s contained in the Roadmap is what the companies are already beginning to implement. If the Roadmap was a list of things “to be done” then I would be more suspicious. But I’m seeing companies taking these measures and that makes me optimistic. And from the government side, we have today a political will to really address illegality in the Amazon.
