Soy traders must do more to address land conversion in Cerrado
The five biggest exporters of soy from the Cerrado savannah forest in Brazil have the power, but are not doing enough to address soy-driven deforestation and conversion of native vegetation, according to new analysis from Global Canopy.
Trading soy from the Cerrado – an assessment of the big five assesses the five biggest soy traders on the quality of their deforestation policies, their self-reported progress against these policies and their power to advance more sustainable soy supply chains in the Cerrado.
It finds that while Bunge, Cargill, ADM, Louis Dreyfus and Amaggi all have deforestation commitments, these companies have been slow to recognise the risks in all the regions where they source soy.
This includes the Cerrado – the most biodiverse savannah forest in the world, which under threat from soy expansion.
Just last week, Louis Dreyfus, the smallest of “big five” companies, announced a new policy on sustainable soy that commits to eliminate deforestation throughout their supply chain and conserve ecologically valuable biomes, but this risk has not been recognised by the other big four.
There is growing recognition of the need for action in the Cerrado, which is home to more than 12,000 plant species, many only found in this region. European and North American retailers and manufacturers are among the 62 companies supporting the goals of the Cerrado Manifesto, calling for greater efforts to halt deforestation and native vegetation loss.
None of the big five soy traders have signed the Cerrado Manifesto Statement of Support, and last month, two of the big five traders – Bunge and Cargill – were fined for activities linked to illegal deforestation in the Cerrado.
Niki Mardas, Executive Director at Global Canopy, said:
“The big five soy traders are in a position to do much more to address the challenge of unsustainable land conversion. By looking at the scope of their commitments, at what they say they are doing on the ground, and their power within the supply chain, we can see just where the opportunities for improvement lie.”
The report draws on a new online assessment tool, Company action on deforestation, which looks at the policies, self-reported progress, and power of 137 companies sourcing soy and cattle from Latin America.
Demand for soy and cattle products is driving deforestation in some of the most important natural habitat in Latin America – with areas such as the Cerrado and Gran Chaco losing forest and native vegetation at unprecedented rates.
Research shows that between 2000 to 2014, the agricultural area in the Cerrado expanded by 87%. More than a quarter of this involved the conversion of native vegetation, primarily in the Matopiba region.
Barbara Bramble, Vice President, International Wildlife Conversation and Corporate Strategy at National Wildlife Federation, said:
“Growing global demand for soy is unnecessarily putting vital habitat in Brazil’s Cerrado at risk. With millions of hectares of suitable land, that has already been cleared, available for expansion, the soy sector does not need to rely on converting forests and native vegetation. The companies that produce, trade, finance and use soy in their products need to recognise this and take immediate steps to ensure that their supply chains protect forests and native vegetation.”
The big five soy traders all source from areas of the Cerrado with high levels of deforestation and conversion.
There is a significant opportunity for the private sector to play a role in addressing land conversion, given that more than 75% of the remaining native vegetation is in private hands. Recent corporate zero deforestation commitments go beyond conservation requirements under Brazil’s Forest Code, but in many cases they need to be expanded to more explicitly cover the Cerrado’s native vegetation.
Global Canopy’s report argues that the sheer dominance of the big five traders gives them significant power to influence soy supply chains. Combined, the five traders were responsible for 60% of the total soy exported from the Cerrado in 2015.
Based on company self-reported progress, Bunge scored highest for their implementation efforts including for their work to introduce traceability and compliance monitoring across the supply chain, yet their policies were found to lack the robustness and comprehensiveness to effectively deliver deforestation- and conversion-free soy supply chains.
These assessments do not measure company performance in reducing deforestation, but provide an indication of a company’s approach.
Trading soy from the Cerrado - an assessment of the big five
An assessment of the five biggest soy traders on the quality of their deforestation policies, their self-reported progress against these policies and their power to advance more sustainable soy supply chains in the Cerrado.Download this report