Tracking China’s soy and beef imprint on South America

Photo: Fábio Nascimento Foreword

2Photo Trackingby James Sanday China’s on Unsplash soy and beef imprint on South America Contents

BOOMING BEEF Brazil’s beef exports increase deforestation risk | 4 How soy and beef spark Amazon fires – and how to stop it | 7 Climate crisis threatens Latin America’s food production model | 10 Chinese consumers ignore calls to eat less beef | 13 Meat consumption threatens international climate commitments | 16 Will exporting beef to China drive deforestation in Bolivia? | 19 Are cows raised in forests better for the environment? | 22 Meat substitutes can cut China’s environmental impact in Latin America | 24

SURGING SOY Tracking China’s soy footprint in Brazil | 27 US-China trade war raises fears of deforestation in Brazil | 29 Stark images show soy-linked deforestation in Argentina | 32 Soy demand pushes agribusiness to the banks of the Amazon | 35 São Luis megaport conflict intensifies | 38 Can banks in Beijing stop deforestation in South America? | 42 Can the ‘tiger nut’ solve China’s soybean crisis? | 45 Chinese consumers can help drive sustainable agriculture in Brazil | 48

1 Foreword from the editor:

ery few images have commanded the subsequently deforested land. scale of global media attention, and V censure, recently as those depicting Yet, the expansion of the crop has the fires that raged through the Amazon devastated the Cerrado, a vast tropical during August and September 2019. savannah where no such commercial pact exists and where half of all forest French president Emmanuel Macron was cover has been lost. Similar trends occur among those quick to express indignation in neighbouring Argentina, Paraguay and, as flames tore through parts of the forest more recently, Bolivia. Soy plantations also while Brazilian counterpart Jair Bolsonaro displace cattle ranchers towards pristine vigorously defended what he saw as his forests despite much already degraded land country’s right to ‘develop’ its portion of the being suitable for pasture. Amazon - a hotbed of illegal logging, mining and cattle ranching - as it saw fit. Meanwhile the port, road and rail infrastructure required to transport the The fires may have reignited an impassioned crop to markets further penetrates forests, international debate about sovereign resource with consequences for ecosystems and the management and responsibilities to limit the communities that steward them. emissions that cause climate change, but they also helped illuminate the complex role Beyond the fires, this past year witnessed of both producers and consumers of South a landmark Intergovernmental Panel on American agricultural commodities in driving Climate Change (IPCC) report on land use deforestation in its most sensitive biomes. that urged drastic changes to the way we produce food. Trade tensions between the Conspicuously inaudible in the chorus US and China also place more pressure on of voices condemning Bolsonaro’s South America to meet the latter’s demand permissiveness, even encouragement, for tariff-hit US agricultural products, towards loggers and ranchers clearing principally soy. land for pasture, was China. Chinese food companies bought up a quarter of Brazilian As global trade patterns shift, it becomes beef exports in 2018, up 50% on the previous vitally important to track and better year and more than any other country. understand their impacts on forests, emissions, soil and water sources. As well as beef, China buys more soy than Recognising this, Diálogo Chino presents this any other country from both Brazil, where special selection of articles examining China’s production grew 312% between 1991 and 2017, soy and beef footprints in South America, and Argentina. Soy has not been so closely which explores new ways of satisfying associated with Amazon deforestation since growing Chinese demand whilst making trade a 2006 moratorium in which multinational more sustainable. And despite the numerous traders agreed not to purchase soy grown on challenges, there are causes for optimism.

2 Tracking China’s soy and beef imprint on South America Chinese consumers increasingly care about what they eat and the market for sustainably-sourced foods is growing. In recognition of this - and the reputational damage that links with environmental mismanagement can incur - big state-owned Chinese commodities traders such as COFCO have made commitments to eliminate deforestation from supply chains.

South American and international producers are responding to such signals, offering market-based solutions to the urgent problem of expansive soy and beef. Chinese financial institutions that support the trade are ever more aware of their exposure to ‘deforestation risk’.

This special series zooms-in on the loci of soy- and beef-related deforestation in Brazil. We travelled to Itaituba in Pará and São Luis in Maranhão to document the effects of China-backed port infrastructure on local livelihoods. We observe the spread of soy-linked deforestation in the Argentine Chaco region ask what opening beef exports to China will mean for the Bolivian Amazon.

We also assess the potential for improved sustainability through silvopastoral farming models, which combine forestry, forage plants and cattle ranching, and alternatives to soy and beef, including the ‘tiger nut’, a tuber, and plant-based meat substitutes.

China’s agricultural engagement with South America is driving radical changes to the region’s economy and environment. The articles in this series bring unique Chinese and local perspectives to the conversation about how to improve sustainability, which has implications not only for those invested in the agriculture trade, but for the entire globe.

Isabel Hilton founder and editor, Diálogo Chino

3 Cattle ranching is a major driver of deforestation in the Brazilian Amazon Photo: CIFOR

Thais Lazzeri Chinese demand for Brazilian beef raises deforestation risk

Southern Brazil eyes lucrative Chinese market, displacing ranches to the Amazon to meet domestic demand

Last year the Brazilian beef forest engineer Paulo Barreto, of will be used for livestock, with industry broke its own records. the Amazon Institute of People 20% of new beef going abroad, It exported 1.6 million tonnes, and the Environment (IMAZON). along with 80% of leather. up 11% compared to the Barreto stressed that the boom previous year, according to the in exports puts extra pressure Much of this growth goes Brazilian Association of Beef on forests since domestic to China, the top buyer of Exporting Industries (Abiec). production almost matches Brazilian beef. It purchases consumption. “If it were only almost a quarter of all exports But while the industry for the domestic market, this and numbers are rising fast. celebrated, the numbers would not happen.” Last year, China purchased rang alarm bells for 50% more Brazilian beef than environmentalists. According to IMAZON, 40% of in 2017 —the steepest increase new cattle herds are in the in volume of any importer. “Livestock is the major driver Amazon. Approximately 80% of Brazilian deforestation,” said of recently deforested land After eight years of decline,

4 Tracking China’s soy and beef imprint on South America deforestation in the Amazon Brazilian beef exports to China by port (tonnes) region began to grow again in Bacarena: 97 2012, when beef exports grew Itajai: 192 7.8% compared to the previous Paranagua: 47,193 year, according to Abiec. Rio de Janeiro: 5,403 Rio Grande: 6,356 DECOUPLING Sao Paulo: 2 DEFORESTATION AND Sao Francisco: 1,136 GROWTH Santos: 229,612 Some factions of Brazilian agribusiness fiercely fight environmental protection agencies’ efforts to curb deforestation, claiming the total value of Brazilian “It is a type of indirect effect,” that the industry is vital for agricultural products. São said Barreto. “The connection is economic growth. Paulo state produces almost very strong.” the same value with a quarter Last year, its caucus in of the farmland. Global Canopy, an NGO, maps Congress supported the supply chains associated with successful presidential The Amazonian areas were deforestation in tropical forests. candidacy of Jair Bolsonaro, most often deforested The organisation compares who called the agencies illegally, with around 65% used data to identify which Brazilian “fine factories”. Bolsonaro’s for low-productivity pasture, municipalities produce beef agriculture minister pledged which counts as less than one that ends up in China. to create a “more favourable” head of cattle per hectare, environment for agribusiness. according to the Amazon “Our idea is to connect Environmental Research businesses and go to the However, deforestation in the Institute (IPAM). municipality where the meat Amazon is not a necessary evil originates, thereby connecting for economic development. A MAPPING SUPPLY CHAINS the origin of the meat to recent study by the University of deforestation,” said Simone São Paulo’s Institute of Energy The process of tracing cattle Bauch, Global Canopy’s and Environment showed reared on deforested land director for Latin America. that agricultural production to international markets is However, tracing is difficult in the rainforest can be highly inhibited by logistical and because, as Bauch pointed out, inefficient in terms of land use. other issues. There is still no “cattle move”. evidence that beef coming The 750,000 square kilometre from pastures in deforested According to Christina area of the Amazon that has parts of the Amazon goes to MacFarquhar, one of the been deforested for cattle China, for example. scientists responsible for the ranching – a land mass mapping, nine of the top 20 twice the size of Germany Given the transport costs, companies surveyed produce – contributes only 14.5% of meat produced in the south of cattle for the Chinese market. Brazil is more competitive for The other 11 feature in the the Chinese market since it is leather supply chain. closer to major ports with links to Asia, such as Santos in São Beef purchasers include Paulo State. companies like the Kai Bo 14.5% supermarket chain, one of the the value of Brazilian However, researchers believe largest importers, and retail agricultural products that because the south giant China Resources National, that come from the now caters for foreign beef operated by CR Vanguard. demand, the Amazon may Amazon have increased production to Global Canopy’s project supply the domestic market. will also investigate how

5 over half of Brazil’s emissions are caused by deforestation.

According to the watchdog Climate Observatory, fertiliser use and methane produced by livestock also contribute planet-warming gases. The last report from the Intergovernmental Panel on Climate Change stressed the urgent need to completely halt deforestation, which could be one of Brazil’s main contributions in the fight against global warming. Photo: Marcelo Carvalho on Unsplash As part of its commitments under the Paris Agreement, committed companies are to the previous Brazilian implementing good practices government pledged to cut and preventing deforestation. its emissions by 37% by 2025 and 43% by 2030, conditional “Basically, the results are not on international financial positive, since we did not find We believe in assistance. anti-deforestation policies on the Chinese companies’ the power these While Brazil’s new administration websites,” said MacFarquar, companies have stopped short of pulling out of who concedes that the the Paris Agreement, it is highly movement to eliminate to influence and unlikely to advance policies that deforestation from supply will lead to lower emissions. chains is new in China. encourage Brazil President Bolsonaro said Brazil to change “does not owe the world There is, however, some anything” when it comes to the evidence that Chinese environment. companies are willing to improve sustainability in chain that could help prevent it. Bolsonaro’s uncooperative agricultural supply chains. stance could put more “We believe in the power these emphasis on the private sector Jun Liu, chairman of China’s companies have to influence to advance sustainability in largest food processor COFCO, and encourage Brazil to food production. Researchers announced in a January 2018 change,” MacFarquar said. even believe that as well as article that coincided with protecting forests, sourcing the World Economic Forum GREENHOUSE GASES deforestation-free beef could in Davos, Switzerland, that be good for business. the company would support Deforestation has become a tougher rules on trading soy that growing international concern MacFarquar said consumers is cultivated in deforested areas. because of the carbon emitted worldwide are increasingly when trees are felled, which opting for brands with clear While Global Canopy’s mapping causes climate change. policies on the environment project does not try to dissuade and sustainability: Chinese and other international In 2016 Brazil featured seventh companies from buying beef in the list of the world’s biggest “This is not just about saving associated with deforestation, greenhouse gas emitters. the planet and the forests but they encourage them to drive According to the Working about saving your finances and changes in the meat supply Group for Zero Deforestation, your business.”

6 Tracking China’s soy and beef imprint on South America Thais Lazzeri How soy and beef spark Amazon fires – and how to stop it

Research shows production can increase without deforesting, yet 80% of forest cleared is for pasture

In the Amazonian city of São and Agriculture Organization. prevail over forest preservation. Félix do Xingu, in Pará state, In a meeting about the fires there are nearly 20 head of Brazil is the world’s number with Amazon region governors cattle for each inhabitant. With one beef exporter. China last week, Bolsonaro said that more than two million cows, and Hong Kong are its main new reserves would “make São Félix is the Brazilian city buyers. But the country is Brazil unviable”. with the largest herd. also the largest exporter of soy to China. As soy expands However, research shows that It also is the city with this in other Brazilian regions, it the destruction of the Amazon year’s third highest number sparks a chain of events that could also destroy Brazilian of fires, which are destroying involves the displacement of agribusiness, a central pillar of the Amazon and shocking other farmers and ranchers the local economy. the world. who, sometimes in cahoots with illegal loggers and miners, More than 90% of Brazilian The fires around São Félix clear swathes of the Amazon. agriculture is not irrigated demonstrate how farmers and depends on the rain the clear land for cattle. Almost Brazil’s president Jair Amazon creates. Amazon 80% of destruction in the Bolsonaro insists that deforestation reduces the Amazon is associated with economic development in amount of water produced creating pasture, according to the Amazonian region, one of by evapotranspiration and a 2016 report by the UN’s Food the country’s poorest, should increases temperatures,

Photo: skeeze from Pixabay

7 also generating higher CO2 between soy producers, the emissions, according to government, and civil society André Guimarães, executive to refrain from purchasing or 90% director of the Amazonia planting in deforested areas in Environmental Research Amazon states Mato Grosso, of Brazilian agriculture Institute (IPAM). Maranhão, Tocantins, Pará, is not irrigated and Rondônia, or Amapá. depends on rainfall “China is among those most interested in safeguarding Approximately 76% of crops the water produced by the planted in deforested areas demonstrating an increase Amazon region because it are in Mato Grosso, the in productivity, according makes commodity production number one producing state to the watchdog Climate cheaper,” he said. nationwide. Nevertheless, Observatory. there are signs that the AGRIBUSINESS FIGHTS accord works. The average Nor is deforesting in order BACK rate of deforestation in the 89 to plant more yielding great municipalities of Mato Grosso results in Brazil. Between Some members of Brazil’s is 6.5 times lower following 2007 and 2016, the average agribusiness lobby are the 2006 Soy Moratorium. yearly deforestation of 7,400 attempting to distance Only 1% of soy in the Amazon square kilometres translated themselves from reports region is planted in recently into a 0.013% increase in linking them to Amazon deforested areas. Brazil’s GDP, according to deforestation. The culprits, the Zero Zero Deforestation they say, are land grabbers Working Group. seeking to profit from real estate speculation, “Destruction of the forest not profitable and legal is not necessarily required businesses. to increase soy production”, The forces of Abramovay wrote in his 2018 Luiz Cornacchioni, executive the just and book The Amazon Needs a director of the Brazilian Natural Knowledge Economy. Agribusiness Association, says honest must he’s in discussions with the all be aligned, IPAM’s Guimarães made government on how to take a distinction between more effective action against including the productive law-abiding illegal deforestation and one buyers of Brazilian agribusiness and of its main causes – land environmental crimes fraud. commodities committed in the Amazon.

“Sustainability is the name of “More than 90% of the game. The sector cannot The notion that deforestation deforestation is illegal, the be harmed by criminals,” he increases production is result of criminal acts by said. “Brazilian agribusiness misleading, according to land grabbers, loggers, and has already shown that it is Ricardo Abramovay, an gold miners,” he said. “If it possible to produce as well economist at the University is crime, the forces of the as preserve. We have a Forest of São Paulo. He argues that just and honest must all be Code that must be complied land investments should aligned, including the buyers with. The government needs not concentrate on turning of Brazilian commodities.” to apply the law and the forest to pasture, but rather penalties it establishes.” in technology to make it more The most vulnerable regions productive. of the Amazon produce In 2017, the amount of soy much more meat and soy for planted in deforested areas Between 1991 and 2017, the domestic market than grew by 27.5%, according to a Brazilian soy production for export, researchers say. report by the Soy Moratorium, soared 312%, while the However, foreign demand for an environmental accord planted area expanded 61%, products from parts of the

8 Tracking China’s soy and beef imprint on South America country where agriculture CHINA’S RESPONSE companies, COFCO is setting has less impact on the forest a good example for other pushes producers focused In contrast to French president Chinese companies. on the domestic market Emmanuel Macron, who towards regions with high appears to have taken up “Its announcements caught the deforestation rates. protecting the Amazon as attention of other companies his newest political cause, in China and abroad,” she said. The complexity of the meat the Chinese government has “But because other companies production chain and the largely remained tight-lipped do not yet have sustainability lack of transparency in meat- on the fires. departments and COFCO has packing operations also the advantage of being a state- encourage bad practices, However, it has downplayed owned company with global known as “cattle laundering” suggestions that the country operations, it will take time by processing plants and their bears some responsibility for before we see more public suppliers. driving deforestation in the commitments from Chinese Amazon. players.” An investigation by Repórter Brasil found that large companies “The correlation is new to me,” NGO Global Canopy, which in the sector, such as JBS, foreign ministry spokesperson maps production chains Marfrig, and Frigol, buy cattle Geng Shuang said at an August and their impact on tropical from ranchers who have received 26 press conference, in response deforestation, has investigated fines in regions notorious for to a question about about global supply chains in the beef and deforestation, and which are at beef consumption and the fires, leather trade between Brazil the epicentre of fires raging in the which noted China’s possible role and China, which are exposed Amazon. as a major importer. to a “deforestation risk”.

Amazon cattle ranching is China was aware of the fires The top 20 Chinese companies also relatively unproductive. and supported the Brazilian in these sectors do not have The Amazonia Environmental government in its efforts to sustainability policies related Research Institute (IPAM) fight them, he added. to deforestation, despite their showed that 65% of significant impact, Global deforested land is used In a meeting with Canopy found. for low-quality pasture. On representatives from Brazilian average, each head of cattle agribusiness last month, “It is in fact a consumer in the region occupies an area Jingtao Chi, chairman of market that directly impacts equivalent to a football pitch. COFCO International, China’s the expansion of Brazilian largest trading company, agribusiness,” said André Almost one fifth of it has been which imports a quarter Vasconcelos, a Latin America destroyed. In 1960 it was 1%. of Brazil’s soy, repeated researcher at Global Canopy, “sustainability” several who also works on the Trase Brazil has shown that it can slow times, according to IPAM’s supply chain transparency tool. deforestation. Between 2003 Guimarães. and 2012, rates fell by 80%. In an interview with Brazilian In January, Jun Lyu, another news portal UOL, Chinese However, since 2012 the pace COFCO executive, caused a Minister-Counsellor Qu Yuhui has picked up and Brazil has stir by publishing an article said that the current crisis was begun to backtrack on an urging the international “a bit fabricated” and that Brazil international commitment community to combine efforts has one of the best standards to bring annual deforestation in combatting deforestation. for environmental conservation down to 3,800 square in the world. kilometres next year. Isabel Nepstad, a senior consultant for the Solidaridad “Brazil has been consistent in Some researchers predict that Network, which monitors protecting the environment,” he deforestation in the Amazon global supply chains, said said. “It is not me recognising could surpass 10,000 square that by joining the ranks of this [fact], but rather the kilometres this year. major international trading Chinese government.”

9 World meat production has tripled in the past four decades Photo: Fábio Nascimento

Fermín Koop Climate crisis threatens Latin America’s food production model

As a global food supplier, the region must adapt land use to combat climate change, new IPCC report says

With the largest amount its biodiversity decimated. “Land is already being of cultivatable land in the Preventing further expansion affected by climate change. world, Latin America plays will be central to combating This has a particular a key role in global food climate change and ensuring emphasis on Latin America production. The region has food supplies, according as a food-producing experienced significant to a new report by the region,” said Eduardo agricultural expansion in the Intergovernmental Panel on Calvo Buendía, a Peruvian last 50 years, increasing the Climate Change (IPCC). researcher and IPCC co- cultivated area from 560 to chair. 740 million hectares – with According to the IPCC, devastating environmental which brings together “The use of the land can consequences. climate scientists worldwide, contribute to the solution the misuse of land can of the problem but making Much land today is exacerbate global warming progress only with this sector deforested or degraded and and worsen its effects. is not enough.”

10 Tracking China’s soy and beef imprint on South America Land degradation is also weather phenomena associated with poverty. increasingly common, Farmers with fewer putting agricultural 14% resources have less access production and the Latin to land and water and work American economy at risk. of the world’s with low-quality soils that degraded land is in are highly vulnerable. Around IPCC projections are not Latin America 40% of the world’s most good, especially for tropical degraded land is in areas countries in Latin America with high levels of poverty. such as Brazil and Colombia, which would see a drop in VICTIMS AND VICTIMISERS “The report is a call to crop yields as a result of strengthen Latin America’s global warming. The land – and how human agriculture systems. We must beings use it – has both stop deforestation processes, “The tropical countries of drive and feel the effects of promote crop rotation South America will be the climate change, according to systems and strengthen most affected in the region, Esteban Jobbágy, an Argentine agroecological production,” with negative consequences researcher at the IPCC. said Miguel Taboada, a on their economy. Their researcher at the Institute agricultural systems are not Population growth and of Argentina’s Agricultural resilient enough,” said Louis changes in diets since the Technology Institute (INTA). Verchot, a US researcher at middle of the last century the IPCC. “Both small and have led to unprecedented large scale agriculture will rates of land and water face difficulties.” use. Agriculture consumes around 70% of the world’s Depending on different freshwater. climatic scenarios, the increase in temperature in “Latin America still has a lot Latin America could vary of land that can be used for Agricultural from 2°C to 6°C, according agriculture. This report opens systems are not to the IPCC. At the same the eyes of decision-makers in time, by the 2050s it is the region,” Jobbágy added. resilient enough estimated that around 50% of the region’s agricultural Agriculture, forestry and other land will be affected by land uses generate 23% of desertification. greenhouse gas emissions globally. But its expansion, at FOOD SECURITY DIET CHANGES the expense of native forests, not only generates more Latin America has just 8% of Livestock occupies a central emissions but also degrades the world’s population but role in Latin America but if soils and limits its capacity to 23% of potentially arable consumers can be persuaded absorb emissions. land. Its global share of to eat less meat because of currently cultivated land is climate and health reasons, There are currently more 12%, while it also has 46% this could change the sector’s than two billion hectares of tropical forests and 31% plans to expand. of degraded land in the of the planet’s freshwater, world, 14% of which is in according to the FAO. World meat production Latin America, according has tripled in the last four to the UN’s Food and This makes the region a decades. Today two billion Agriculture Organisation (FAO). central actor in guaranteeing people are overweight or Degradation occurs due food security, which today obese, which is often linked to to deforestation, intensive is threatened by climate increased meat consumption. application of agrochemicals change. Rainfall patterns and erosion. are changing and extreme In its new report, the IPCC

11 50%

of Latin American land could become desert by 2050

THE PATH FORWARD

Along with dietary changes, the IPCC highlighted a series of short- and long-term solutions for Latin America.

There are actions that would have immediate positive effects, such as conserving wetlands and forest ecosystems, which store huge amounts of greenhouse gases that are released when they are destroyed. Other interventions, like reforestation, need decades to be effective.

Land must remain productive to maintain food security given expected global population increases and the negative impacts of climate change, the IPCC said.

Less extensive farming methods can reduce pressure on forests Experts highlighted Latin Photo: Fábio Nascimento America’s great potential to drive change as a principal food producer. So-called “climate-smart agriculture” highlighted the benefits of 20% of poultry. In the last must advance without moving from a meat and decade, exports of beef from degrading soil. There is also dairy-based diet to a plant- the region have more than the potential to increase based diet. This brings “great doubled, while exports of productivity in currently opportunities” to mitigate pork and poultry from Brazil cultivated land, without and adapt to climate change, and Chile have more than expanding production and in addition to bringing health quadrupled. encouraging deforestation. benefits, promoting less extensive livestock systems “It is questioning how “The region can do much (such as silvopastoral sustainable this food chain is more to manage its soils models), and reducing and in Latin America, it can sustainably,” Verchot said. pressure on native forests. have great consequences,” “You can maintain the said Jobbágy, “Lower productivity of currently Latin America and the consumption of animal cultivated soils so you don’t Caribbean is responsible products could give us more have to deforest more areas. for more than a quarter of chances to combat climate For this, governments have to world beef production and change.” invest in rural areas.”

12 Tracking China’s soy and beef imprint on South America Wang Chen Chinese consumers ignore calls to eat less beef

Imports rise as domestic farmers struggle to meet demand

Despite increasing prices daily since December. But the longer-term cause is and evidence that too much simply domestic supply not beef is bad for health and Figures from the Ministry meeting demand. the environment, a belief that of Agriculture show that eating red meat makes you in January and February Prosperity has fed the demand strong persists in China, and wholesale beef prices rose for beef. By 2017, China consumption is accelerating. over 11% compared to consumed 7.94 million tonnes the same period in 2018. of the red meat, more than any Shortly after the Chinese New Importers have been stepping other country in the world, but Year holiday, business was in to profit. much lower per person than brisk again at the beef and the global average. lamb section of the Xinfadi UNTIL THE COWS COME Wholesale Food Market. HOME China’s farmers haven’t been able to keep pace with the Known as “Beijing’s shopping Hao Na, CEO of New Zealand growth. Up until 2017, beef basket”, the market is popular import-export firm Taonga farms were usually small-scale with urbanites looking to pick Belt and Road Industrial Park operations, with only 2% sending up cheap fresh food. But Limited, told Diálogo Chino that more than 1,000 head of cattle according to Li Cheng, who the rising price of beef is linked to market annually. These has been selling meat here for to rocketing chicken prices and farmers have been discouraged more than a decade, the price an outbreak of African swine from expanding by rising costs of beef has been rising almost fever which hit pork supply. for land, labour and fodder.

Photo: pxhere

13 Annual beef comnsumption in China since 2000 the first to be broadcast in Annual beef consumption (10,000 tonnes) China, many Chinese people 1,000 concluded that the success of foreign athletes was partly 800 down to consuming more 600 beef and milk. 400 Zhu Jiajin, a food science 200 professor at Zhejiang 0 University, told Diálogo 2000 2002 2004 2006 2008 2010 2012 2014 2016 Chino that beef is high in absorbable proteins, as well The additional demand has In just three years, from 2015 as micronutrients including been met by imports. Data to 2018, Brazil’s exports of beef iron, potassium and selenium. published by the customs to China jumped from 56,000 But studies have also linked authorities in January put tonnes to 320,000 tonnes. In red meat to increased risk total beef imports for 2018 at 2018, 50% of the beef exported of heart disease, cancer one million tonnes, up from by Uruguay and Argentina and diabetes. Zhu Jian just 23,700 tonnes in 2010. A ended up on Chinese tables. suggests wealthier people Ministry of Agriculture report China has now become of may be eating too much red predicts a sustained rise in the most important buyer for meat while those in poorer beef and lamb consumption in South American beef. households aren’t eating the coming decade, with beef enough. imports continuing to grow. Sergio Ray, foreign markets officer at the Argentine Beef THE ENVIRONMENTAL Liu Yi, 25, is an aircraft pilot Promotion Institute, made COSTS OF LIVESTOCK living in Shanghai. He grew up in a trip to Beijing last year to FARMING Xi’an eating the well-regarded advertise Argentinian beef. local beef but today he often Beyond its effects on buys imported cuts from the Hao Na says that while health, beef consumption supermarket: “It’s not ideal for South American beef is increases carbon emissions making Chinese dishes. But slightly inferior to that from and pollution from farming. sometimes Chinese beef, from Australia and New Zealand, it In 2006, the UN Food and Shaanxi, Gansu or Inner Mongolia, is plentiful and cheaper, and Agriculture Organisation is even more expensive than the so is being imported in large pointed out that livestock imported beef.” quantities. farming is a major contributor to the greenhouse effect, Since 2015, South America has THE BEEF COMPLEX being responsible for a higher been gradually becoming an share of carbon emissions important source of China’s Many Chinese consumers than the transportation sector. beef imports. Figures show see beef as a healthy option, That was the year that China’s that in 2013 Australia provided according to Jian Yi, founder of domestic beef production half of China’s beef imports, the Good Food Academy. He ended six years of growth, but by 2017, 70% came from says that after watching the with imports then rising to South America. 1984 Los Angeles Olympics, meet demand.

Chinese beef imports since 2010 Chinese beef imports (10,000 tonnes)

125 100 75 50 25 0 2010 2011 2012 2013 2014 2015 2016 2017 2018

14 Tracking China’s soy and beef imprint on South America Changes in Chinese beef imports by Country

Uruguay Argentina Brazil

2013

2014

2015

2016

2017

2018

0 5 10 15 20 25 30 35 (10,000 tonnes)

Cattle produce more directly onto grasslands. stronger?” emissions than any other farm animal. Producing one Research recently published Some big meat-eaters do kilogram of beef releases in the journal Nature says that seem to be more willing to twice as much greenhouse if current levels of red meat change their eating habits for gases as a kilogram of lamb, consumption and processed the sake of the environment. and 3.5 times as much as foods continue as population Research in China by Wildaid, chicken or pork. levels rise, the environmental an international NGO, found effects of the food system that one third of 5,218 South America, China’s main could increase by up to 90% respondents said they could supplier of imported beef, has by 2050, beyond the planet’s eat less meat for the sake of incurred huge environmental ability to cope. the environment. costs. Data from the World Resources Institute shows LESS BEEF? Zhu says that there are plenty that beef production is the of foods which can provide biggest driver of deforestation. A major report on diet the same nutrients as beef. “If Vast expanses of Amazon published in the Lancet this the public aren’t sure exactly rainforest have been felled January recommended that what to eat, they should just to make way for pastures. In the bulk of people’s protein ensure they eat a varied diet.” Brazil alone, three quarters should come from plants, But Zhu is refraining from of deforestation is directly or with an average intake of red commenting on substitutes indirectly linked to livestock meat of just 14 grams per day. such as “artificial meat” farming. Brazil now has over That less carbon-intensive which have been making 209 million head of cattle, and diet would also be more the news recently, saying 20% of the beef it produces is environmentally friendly. In that even if they have the exported. 2016, the Chinese Nutrition same nutritional value as Society suggested adults beef, they won’t be a perfect China’s livestock farming eat 40-75 grams of meat or replacement: “We still don’t sector has tripled in size over poultry a day. fully understand what’s in the past three decades. This beef and what it does.” growth has come at a cost. But the Chinese public does In June 2018, environmental not seem convinced. In an For pilot Liu Yi, “Food is a inspectors from central online poll of 500,000 people gift from nature. I could eat government found severe about eating beef and health, less meat for the sake of the breaches of emissions the most popular answer environment, but there’s no regulations by livestock expressed scepticism about need to eat artificial meat.” farmers in Heilongjiang, with calls to eat less beef: “An large quantities of manure average steak is 150g, you’d The names of some being dumped and badly need to eat it over two days. interviewees have been polluted water discharged How’s that going to make us changed.

15 Fermín Koop Meat consumption threatens international climate commitments

Rising demand from emerging markets puts pressure on South American forests and emissions targets

Campaigns to cut meat consumption have been highly Livestock is responsible for 14.5% of global greenhouse visible throughout UN climate gas emissions. change conferences (COPs) in recent years, with livestock responsible for 14.5% of global greenhouse gas emissions (GHGs). 14.5% Yet the lack of progress is clearly on show at COP24 at the last round of talks in Poland, with beef burgers, ham gnocchi and bacon

conspicuous among the Source: FAO catering options.

If over the two-week deforestation and water DIET CHANGES conference the 22,000 consumption. Latin America attendees chose meat-based has thousands of hectares Two billion people in high food, the emissions footprint devoted to agriculture and meat-consuming countries would be equivalent to burning rearing livestock. such as the US, Brazil more than two million litres of and Russia should reduce fuel, according to an analysis Without action, the impact will consumption by 40%, presented at the summit. worsen. The world’s population limiting intake to 1.5 servings is expected to increase by per week, according to a “The lack of attention to 2.3 billion by 2050 and global study by the World Resource food as a way to solve the salaries will triple, enabling Institute (WRI) presented at climate crisis was reflected more people to afford meat- the COP. in the food options at COP24, based diets. with menus based on meat Globally, meat and dairy and dairy instead of offering “If we continue producing production uses 83% of land plant-based options,” a food the way we are and the dedicated to agriculture report by campaigners Farm demand continues to grow, and generates 60% of the Forward, Brighter Green and we will need to cut down all sector’s emissions. Along the Center for Biological the forests in the world to with cutting consumption, Diversity said. meet demand in 2050. But the other main challenge is there is huge potential for increasing the amount of Food production creates improvement with greater food produced per hectare. massive environmental efficiency,” said Tobias impacts due to greenhouse Baedeker, a World Bank “Latin America has a central gas emissions from economist who specialises in role, with many hectares animals (mostly methane), agriculture. of poorly managed pasture

16 Tracking China’s soy and beef imprint on South America Photo: Alex Proimos

largely responsible for. is not realistic, according to the WRI report, which On top of this are emissions instead calls on people to 25% from waste and indirect reduce meat consumption. emissions linked to Other recent scientific methane emissions deforestation through the reports agree. contribute 25% more expansion of pasture. The to global warming transgenic (GMO) soybean To prevent average global than carbon dioxide. boom in Latin America warming of more than 2°C largely displaced cattle by the end of the century, ranching to new regions, as targeted in the Paris many covered by native Agreement, the world land that could be more forests. must eat 75% less beef, efficient. The problem is that 90% less pork and cut it is cheaper to deforest than Compared to pigs or egg consumption by half, to improve productivity,” chickens, cows need 28 according to research by said Timothy Searchinger, times more land and eleven Oxford University. the WRI report’s author. times more food and water. They also generate Experts recommend A cow belches through its five times more emissions, introducing subsidies for nose every three minutes. according to US-based plant-based foods, changes Inside the first chamber researcher Gidon Eshel. in office and school menus of their stomachs, known The gap is even greater and taxes on meat-based as the rumen, are bacteria compared to plants such products. At the same that break down everything as potatoes and rice, which time, they urge far-reaching they eat. During the process need around 160 times changes in agricultural they emit methane, a gas fewer resources. methods. that contributes 25 times more to global warming However, persuading the “There is a tendency than carbon dioxide, which whole world to switch to towards the industrialisation transport and industry are a vegetarian or vegan diet of meat production. That

17 means that cows are fed Change in consumption required to limit global warming to 2°C corn and soybeans, crops this century that require more land,” said Beef Eggs Pork Wanqing Zhou, a researcher 0 at the Brighter Green think -20% tank. -40%

“Transforming unprotected -60% -50% ecosystems into areas of -80% -75% food cultivation for cows -100% -90% has been one of the most profitable practices that the Source: Oxford University livestock sector has found and that has led to increases “Chinese consumers in emissions, as seen in the are familiar with Latin [South American] Gran Chaco American words like ‘asado’ [eco]region,” she said. 95% [barbeque] and ‘churrasco’ [grilled beef] and that will RISING CONSUMPTION over 95% of help maintain imports. Chinese meat The biggest advantage of According to UK think imports come from Latin American meat is tank Chatham House, Brazil, Uruguay, the cost and that is why it global meat consumption Australia, Argentina is expected that imports is expected to grow 75% and New Zealand. to China will continue by 2050. China will be to be mainly from those responsible for a large part countries,” said Zhou. of the increase. the total. In Argentina, the volume The average Chinese citizen of beef exported between will consume 55 kilos of More than 95% of Chinese January and October 2018 meat per year by 2026, 10% meat imports come from was the highest in the last more than in 2017, according Brazil, Uruguay, Australia, nine years, with China the to a report by UN’s Food Argentina and New Zealand. main demand centre. The and Agriculture Organisation Between 2011 and 2016, South American country and the Organisation for imports of beef increased shipped 155,144 tonnes in Economic Cooperation and 370%. The trend looks set to the first ten months of the Development (OECD). Pork continue, as local producers year, twice that exported in will remain the preferred struggle to compete with the 2017. option, representing 60% of big exporters. Brazil has also increased beef exports by almost 60% in 2018. They now exceed one million tonnes. More than 45% of the total went to China. The figures are expected to rise next year.

Reyes Tirado, a researcher at Greenpeace said: “The world needs to get towards levels of meat and dairy consumption that allow for a safe planet. Privileged A cattle feedlot in the Amazonian municipality of Porto Velho societies in developed and Photo: Fábio Nascimento developing countries have to lead the change.”

18 Tracking China’s soy and beef imprint on South America Miriam Telma Jemio Will exporting beef to China cause deforestation in Bolivia?

The opening of the Chinese market to Bolivian beef is a boon for livestock farmers but the environmental consequences could be severe

The recent Belt and Road Forum in Beijing brought news that Bolivian meat will soon start to be sold in China. The new market will bring opportunity to livestock farmers, but unless they migrate to more sustainable production, serious deforestation may also result. In the last two decades, Bolivian farmers are celebrating the opening of the beef market to China, news livestock caused 60% of that is welcomed as it is likely to increase their production. Photo: Fegazacruz deforestation in the country – similar to Brazil and Colombia. hoping to benefit. through bank loans and Bolivian cattle ranchers aim to agricultural training. export 20,000 tonnes of beef “This means exporting in almost Investments will also need to in the second half of this year. half a year what has been done be made in productive and That would make the Andean in 10 years,” said Gary Rodríguez, commercial infrastructure, country about US$75 million, president of the IBCE, which and water dams, as Oscar or five times more than in all supports exporters. “By 2020, Ciro Pereyra, president of of 2018, according to figures we would be selling US$150 the Confederation of Cattle from the Bolivian Foreign Trade million to the world only for Ranchers of Bolivia (Congabol), Institute (IBCE). the export of meat. However, explained. the projection is to move from By 2020, the goal is to sell a cattle herd of 10 million to 17 However, it is unclear how they 40,000 tonnes to China. million in 10 years.” will go about it. Diálogo Chino reached out to Pereyra for HOPES OF A MEAT BOOM That would mean going from clarification on three occasions, using 13 million hectares but received no answer. On 26 April, the Bolivian foreign for livestock rearing to 20 minister, Diego Pary, and the million hectares, according Currently, 90% of exported minister of Chinese customs, Ni to the goals of the Livestock meat (about 3,500 tonnes) Yuefeng, signed a protocol that Development Plan 2020-2030 goes to Peru. In farmers sights opened the doors for the export presented by ranchers to are markets like Vietnam of Bolivian beef to China. former president Evo Morales (already open), Russia (in the in January. process of opening) and the As the consumption of beef European Union (which has rises sharply among the 1.4 On top of this, small farmers only approved select cuts of billion people in China, Bolivian will need to be helped to meat). None is as promising as ranchers and civil servants are increase their productivity China.

19 At least three companies from the department of Santa Cruz are ready to export beef to China, having been visited by their Chinese customers and certified by the National Service of Agricultural Health and Food Safety (Senasag).

In turn, farmers in the Deforestation has been rapidly increasing in regions such as Santa Cruz. Amazonian department of Photo: Edmond Sánchez/FAN Beni expect the government to fulfil its promise to build a cold-storage plant in the high and low temperatures, that the conversation about department’s capital Trinidad, so otherwise stress leads to low increased meat production they no longer need to depend yields,” he adds. is not accompanied by a on the one in Santa Cruz. discussion of issues such as COWS VS. FORESTS soil management or better “In Beni we have a lot of solutions to cope with climate potential to grow, but we need The main cause of deforestation change, such as silvopastoral investments. We hope that in Bolivia is livestock, according systems where cows share exports will be opened and to a study published by the space with trees. that the new Soil Use Plan will Friends of Nature Foundation be approved so that we can (FAN) in 2014. “You have to think about have the infrastructure in Beni, changing the production without having to dismantle “As of the year 2000, the model to a more sustainable around us,” says José Eduardo perception we had that the one with qualitatively different Iriarte, member of the board of expansion of the agricultural products and not similar to the Federation of Livestock of frontier was mainly for soy those that Brazil, Argentina and Beni (FegaBeni). changed. From the years 2000 Paraguay produce, for example” until 2018, it is livestock. We says Miguel Ángel Crespo, The scientific and analysed until 2013 and more who is concerned about the environmental communities than 60% of deforestation was profitability of transporting are concerned about the caused by livestock,” says FAN meat from the interior to a port “dismantling”, by which Irarte director Natalia Calderón, an in the Pacific and then on to means deforesting. expert on climate change and China. conservation. “With this type of “To export, Bolivia has to agroextractivism we are “It is going to mean the compete … If it wants to going to seriously exacerbate expansion of the space that is export meat that is organic, problems of droughts, floods, destined to the cattle … We are that comes from cattle fed climatic changes, appearance not yet talking about incentives with natural pastures – that of pests, soil erosion … We for producers, technology, would be the only way out are having droughts because technical assistance, adequate for Bolivia to be competitive. there is savage deforestation monitoring, control and Otherwise it’s going to be happening in Beni and Santa inspection,” she explains, another debacle like soy, Cruz,” says Miguel Ángel adding that they have detected whose prices fall and the Crespo, agroecology expert and expansion in deforestation in producers ask the government director of the environmental regions such as Charagua and to pay them subsidies that NGO Probioma. Chiquitania in Santa Cruz. In come out of our taxes.” fact, the department accounts “Farmers do not want to for 78% of the country’s Farmers feel their industry understand they must deforestation. is not mainly responsible for conserve forests because they deforestation, especially in want only open pastures. But The problem raised by Beni, which has extensive livestock have to shelter from environmental experts is plains covered by pastures

20 Tracking China’s soy and beef imprint on South America (pampas and savannas) and the new land use plan of Beni resources, could be critical,” humid tropical forests on identifies extensive agriculture she adds. gentle piedmont slopes. in areas that still have large forest coverage and, even, Bolivia’s plans to increase its “It’s completely false. The with forest management meat production and then livestock of Beni is made in plans registered in the Forest export it to the other side of the pampas and the clearing and Land Authority (ABT) the world could clash with is minimal if we compare it in municipalities such as another reality. to Santa Cruz or Brazil. The Riberalta. clearing in Beni is only to Many organisations are make cattle paddocks, in the Miguel Ángel Crespo of promoting diets with less high places. We take care of Probioma believes mitigation red meat. In its latest Global the environment. Since our measures need to be taken Environment Outlook report, grandparents we have made on deforestation, as well the UN explains how reducing a cattle ranch in the pampas, as the use of genetically beef consumption lowers even the agriculture that we modified crops and agrotoxins greenhouse gas emissions. This want to carry out now is in the for food production: “These is because cows produce a lot same system,” says guild leader two aspects will strongly of methane and forested areas Iriarte, although he recognises influence exports and the are some of the world’s best that there was deforestation agricultural sector. More and carbon sinks. in the north, in the towns of more countries have more Riberalta, Guayaramerín and regulations that are closing the “One of the great challenges for Vaca Diez province. doors to products that come the planet is to meet the high from regions with high use of demand for food because of This sustainable feature of transgenic and agrochemicals population growth and, at the Benian meat, which bears and areas of deforestation.” same time, reduce the impacts the “Bolivia Natural Beef” seal, of agriculture and livestock to could lead the way for other They are not the only meet the demand for food. regions. environmental impacts that We do not know if there are could be increased by livestock public policies to guarantee “In Beni there is livestock but activity. that this process is sustainable, it is done in natural pastures, or if there are demands from which does not necessarily Livestock farming, which the markets (China and Russia) imply deforestation. They requires a lot of water, is on these points, or that the would have to be careful there spreading into regions scarce in agroindustrial companies are in everything that has to do water. talking about these points in the with the management of water agreements,” says Calderón. and soil,” says Calderón of FAN. “Livestock is expanding in two critical areas for the In May, in a meeting with In any case, some researchers water issue: in the Chaco and members of a commission see reasons for caution. Chiquitania regions, which of the Chamber of Deputies, Although the livestock industry are ecosystems that already the Confederation of Cattle plans its production on existing have a fragility in terms of Ranchers of Bolivia said they pastures and natural pampas, the amount of water. The have a strategy that considers illegal deforestation may still climate change scenarios technological innovation and result. show us that there will be a competitiveness to promote reduction of water in these more sustainable production. “The pampas fulfil important ecosystems,” explains Natalia functions in the ecosystem Calderón, whose organisation Although no more details are that will be lost when they has also done studies on how known at present, whether become livestock pastures,” livestock faeces contaminate these solutions exist and are says biologist Vincent Vos of water sources. “More climate effectively implemented could the Centre for Research and change, plus an expansion depend on whether markets Promotion of Farmers (Cipca). of livestock management such as China’s demand areas without considering meat produced in a way that For him, it is worrisome that proper management of water preserves forests.

21 Damián Profeta Are cows raised in forests better for the environment?

Argentina launches ‘silvopastoral’ ranching to produce lower carbon beef

In a scene from the not-too- forests, there are an estimated distant future, a young woman 150,000 hectares, mainly in the in Beijing points her smartphone regions of Corrientes, Buenos at a QR code stuck to a packet Aires, Misiones and Neuquén. of beef from Argentina. She finds out that it’s produced ANIMAL WELFARE from cows who enjoy the shade of forested space. Argentina’s National Institute of Agricultural Technology Argentina uses more than 300 Experts say silvopastoral (INTA) is experimenting with million litres of agrochemicals farming – a method that a silvopastoral project that per year, nearly nine times combines forestry, forage expressly promotes animal more than the 34 million plants and livestock – has a well-being, according to INTA used in 1990. The expansion range of benefits in addition engineer Edgardo Casaubón. of silvopasture could help to animal welfare, including One farm combines forestry, reduce this. healthier soils and fewer beef farming and beekeeping. greenhouse gas emissions. Its “The use of chemicals is two varieties involve rearing Juan Ravalli, a vet from the minimal or nil, compared cattle either in pre-existing Ministry of Agribusiness, said to other livestock systems,” native forests or in newly- about silvopasture: “The said Casaubón, adding; planted ones. animals are in a state of peace “Caterpillars are the main and they don’t have heat pests in the Delta area. “It is a very good environmental, stroke problems because they Because I have the trees, economic and social have trees.” birds that feed on insects system,” said Pedro Botta, an can nest and eat caterpillars. agronomist from the ministry Botta added: “In open fields I don’t need to use of agribusiness in Buenos Aires or in feedlots, if there is chemicals.” province, where silvopastoral a change in temperature, farming is gaining ground on animals can die.” The shade that trees offer in small islands surrounded by the silvopastoral systems also brown waters of the Paraná de FEWER PESTICIDES, changes the composition Las Palmas River. BETTER SOILS of the grassland and allows cows to thrive, Botta said. Native forest silvopasture Another quality of extends across an estimated silvopastoral agriculture is Trees also help avoid soil seven million hectares of its low use of pesticides erosion, according to Patricia Argentina, mostly in the compared to other forms of Cornaglia, an expert on northern Chaco region and livestock rearing. Pesticides are silvopastoral systems at the in Patagonia to the south. used to maintain the quality of University of Buenos Aires’ As for planted silvopastoral the pasture cows feed on. faculty of agronomy.

22 Tracking China’s soy and beef imprint on South America and nitrous oxide – more Argentina has an opportunity potent gases in terms of their to export carbon-neutral meat planet-warming effects – and with silvopastoral certification. work out an equivalent value in

terms of carbon dioxide (CO2). “As long as Argentina can spread Each gramme of nitrous oxide the message that part of its emitted by cows is worth 300 production has that certification,

grammes of CO2, while each it may be of interest to a sector gramme of methane equates of Chinese consumers who

to 25 grammes of C02. want to consume healthy products. We very much “In Brazil, they estimate that welcome this,” he said. they can compensate for five cows with each hectare of CRITICISMS eucalyptus planted,” said Botta. “With 100 hectares they can Despite its benefits, some compensate for 500 cows.” Argentine environmental organisations have questioned Such a product would appeal the development of silvopasture in the Cauca Department of Colombia to international markets silvopastoral systems. Photo: Neil Palmer such as China, where many consumers care increasingly “When you see a silvopastoral about the climate and system it is easy to fall in love, environmental impacts of food. everything is divine,” said Pablo “At the correct distance [they] Preliasco, head of sustainable allow the growth of natural “Cattle fattened by grass are livestock at NGO Fundación pastures and an undergrowth valued because they have no Vida Silvestre Argentina. “But if that serves as a refuge for added hormones,” Cornaglia I used to have natural pastures wildlife,” she said. said, adding that other means with a lot of biodiversity and of fattening cows, such as with today I have silvopastoral CLIMATE CHANGE genetically modified soybeans, [farming] with only three are less desirable. species, it’s a disaster.” Cattle farming is one of the main sources of global CHINA EXPORTS Vida Silvestre advocates a greenhouse gas emissions, silvopastoral system called largely because livestock emits Argentina exported a total of Forest Management with methane and nitrous oxide. 550,503 tonnes of beef in 2018, Integrated Livestock, which In Argentina, it is responsible of which 207,000 tonnes were according to Preliasco for around 25% of emissions, destined for China. The second benefits native forest, according to the government. largest importer was Russia, conserves biodiversity which bought 42,380 tonnes. and maintains ecosystem Cornaglia said that in Together, the two countries services, whilst producing silvopastoral systems, trees account for two thirds of exports. meat of a higher quality. absorb part of the emissions from livestock and could China’s beef consumption However, Noemí Cruz, therefore help Argentina has grown by around 30% in coordinator of Greenpeace’s reduce its emissions and meet the past nine years, driven by forest campaign said even an its climate commitments. demand from the growing integrated approach in native middle classes, dietary changes forests seems like damage Silvopastoral systems could and international marketing limitation: “Agro-productive even lead to the production efforts by Argentina. development is prioritised of what its promoters call more than environmental “carbon-neutral meat”. According to Ernesto development and on too large Fernández Taboada, executive a scale. It doesn’t guarantee Producers calculate livestocks’ director of the China-Argentina the maintenance and annual emissions of methane Chamber of Commerce, regeneration of native forests.”

23 Lucia Wei He | He Mu Can meat substitutes reduce China’s environmental impact in Latin America?

The rise of plant-based meat alternatives could reduce pressures on land and water

“Sweet and Sour Omnipork” made from plant protein Photo: Omnipork

Ming Court, a Michelin- a healthier alternative to industry has turned the starred restaurant in Hong consumers, while drastically country into the world’s Kong famed for its authentic reducing the environmental largest consumer and Cantonese cuisine, raised impact of production. importer of soybeans, which eyebrows last year by typically make up 20% of serving a special take on In a letter explaining why pig feed. In 2018, 75% of sweet and sour pork, a they launched a product China’s soybean purchases southern China dish steeped that mimics the use of pork came from Brazil. Driven in tradition. in Asian cuisine, Right Treat by increased wealth, China founder David Yeung noted: has also become the largest Chef Li Yuet Faat replaced “In China, 65% of all meat importer of beef from real pork with Omnipork, a consumed is pork. There Argentina, Brazil and Uruguay. meat substitute made from are 1.3 billion human beings peas, soy and mushroom in China, yet there are 700 But while Latin American protein. Created by Hong million pigs.” governments have celebrated Kong-based Right Treat, an increasingly close trade Omnipork seeks to offer The scale of China’s pork relationship with China,

24 Tracking China’s soy and beef imprint on South America environmental organisations seafood and beef is expected says Jen Leung, WildAid’s are concerned about the to increase. climate director. “The environmental impacts. In traditional Chinese diet is very Brazil alone, increased soy Public policy is also plant-forward and has always production resulted in the loss playing a role in shaping used meat alternatives such of 223,000 hectares of forest consumer choices. In as tofu and wheat gluten.” between 2013 and 2017. 2016, driven by health and environmental concerns, THE RISE OF PLANT “Clearing land for grazing the Chinese government PROTEIN and to grow feed crops like released national dietary corn and soy is the leading guidelines recommending Environmental claims have cause of deforestation and a 50% reduction in meat been a big part of the success ecological destruction in Latin consumption. story of plant-based food America. Much of this is done producers such as Beyond to serve the Chinese meat Meat, which has seen its stock market,” says Matt Ball from surge close to 250% since its the Good Food Institute, a stock market launch in May US-based non-profit that and is targeting 2019 sales of promotes plant-based meat US$210 million. alternatives. reducing meat consumption To appeal to consumers and “If China moves more investors, Beyond Meat and to plant-based meats, can have a rival Impossible Foods rely agricultural sustainability in tremendous heavily on a mission-driven both China and Latin America product positioning that would vastly improve, given impact in meat highlights the environmental how much less land plant- benefits of plant-based meat based meat requires,” says producing substitutes. Ball. countries In a recently published “life CHANGING DIETARY cycle assessment”, Impossible PREFERENCES Foods said that its burgers To promote the guidelines, require 87% less water and According to a recent survey the Chinese Nutrition Society 96% less land to produce backed by the New Zealand partnered with WildAid, than conventional beef, government, more than a San Francisco-based while generating 89% less 60% of Chinese consumers environmental advocacy greenhouse gas emissions. intend to eat more fruit organisation, to produce a and vegetables, and 39% public outreach campaign In a similar report released are reducing their overall highlighting the benefits of a in 2018, researchers at meat intake. The shift is plant-based diet. the University of Michigan attributed to increased health found that the Beyond awareness, which is in turn In a video advert featuring Burger generates 90% less driven by rising incomes. Arnold Schwarzenegger and greenhouse gas emissions and film director James Cameron, requires 46% less energy than Moreover, 42% of respondents WildAid sought to explicitly its beef counterpart. desire foods that are better draw the connection between for the environment, and meat consumption and Having already launched more than 50% are interested environmental harm. their products in Hong Kong, in trying novel plant-based Impossible Foods and Beyond protein products. “An increase in awareness Meat are among several about meat’s negative impact international plant-based food Nevertheless, consumption on personal and planetary companies eyeing the Chinese of animal protein will not health tends to make market. disappear soon. While pork consumers more likely to intake has fallen, dairy, consider plant-based options,” Domestic players don’t

25 many plant-based products include soy protein as a key ingredient, which could continue to sustain demand for soybeans even if meat consumption decreases.

And even if demand for soy is lower, consumption of beef is expected to grow in China, much of which is increasingly sourced from South America.

Nevertheless, even marginal increases in soybean and meat production have a disproportionate environmental impact in producing countries such as Brazil, so a slowdown in demand could have big effects. According to a recent survey, more than 60% of Chinese consumers intend to eat more fruit and vegetables, and 39% are reducing their overall meat intake. According to Leung, “reducing Photo: Fabio Barbato meat consumption can have a tremendous impact in meat- producing countries – it can improve water and air quality, want to be left behind plant-based “meat” in China it can protect forests and either. A number of Chinese reached US$910 million in biodiversity and it can have a companies, such as Whole 2018, representing an average significant impact on climate Perfect Food, have been annual growth rate of 15% mitigation by reducing overall selling “mock meat” for over the past five years. GHG emissions”. decades, mostly targeting consumers that shun meat IMPACT ON LATIN AMERICA In the short term, for religious reasons. environmentalists may have Driven by the ongoing US an unexpected and powerful Having seen the success of trade dispute, Chinese ally in the fight to shift their overseas peers, these purchases of Brazilian consumer perceptions about companies are now trying soybeans increased 30% meat. to expand their appeal to in 2018, reaching 66 million mainstream consumers. tonnes and accounting for African swine fever could 75% of total imports. reduce China’s pork From a commercial and production by 30% in 2019, environmental standpoint, A shift in consumption which would severely China has become the from pork to plant-based decrease the country’s alternative meat industry’s alternatives could in theory demand for South American most prized market, since it reduce demand for South soybeans. accounts for 28% of global American soybeans, which meat consumption and 50% China mostly uses to feed pigs. With domestic pork prices of global pork consumption. expected to increase up to It is difficult to predict just 70% and heightened concerns Although figures are hard how quickly this might around food safety, Chinese to come by, a recent report happen given the nascent consumers could move by the Good Food Institute state of the meat substitute quickly toward plant-based estimates that sales of market, particularly as alternatives.

26 Tracking China’s soy and beef imprint on South America Satellite images of soy cultivation in Brazil’s Mato Grosso state Photo: Sentinel Hub

Thais Lazzeri Tracking China’s soy footprint in Brazil

Report connects Brazilian soy exported to China with deforestation in specific municipalities

Chinese imports of Brazilian soy, triple the quantity changes in large regions soy are linked to the purchased by second largest of Brazil,” says André deforestation of 223,000 importer, the EU. Vasconcelos, a Latin hectares between 2013 America researcher at and 2017, according to new Yet, despite the risks Global Canopy, which is research of production associated with its large responsible for the Trase chains by monitoring trade volume, China initiative along with the project Trase. The extent of purchases proportionally Stockholm Environment deforestation is equivalent less soy from places with Institute. to an area two times the higher rates of deforestation size of New York City. than the EU. China buys Trase combined data most of its soy from on production, buying Of all importers, China is the southern Brazil, while patterns and deforestation most exposed to Brazilian European purchases are to calculate China’s soy linked to deforestation concentrated in areas “deforestation risk”. The because it buys more than further north. percentage risk is calculated anyone else, Trase said. by multiplying total soy- Between 2013 and 2017, “China is the main buyer related deforestation in China bought 42% of Brazil’s and really promotes producing areas by the

27 share of that soy output that China buys. Trase calculated that Chinese buyers are exposed to an 8% risk of deforestation- linked soy.

Brazil planted 128,600 square kilometres of soy to produce the 54 million tonnes purchased by China in 2017. Last year, imports swelled to 84 million tonnes, mainly as a result of the US-China trade war.

LOCALISED DEFORESTATION

More than 2,000 Brazilian municipalities produce soy destined for China. But according to Trase’s report, only a handful of those producing soy purchased by China are associated with deforestation. Matopiba to China: Agrex, “Because it is very Amaggi, LD Commodities, concentrated, we believe Multigrain, Cargill, Bunge, that this is an opportunity and ADM. for China to reduce this impact,” Vasconcelos said. Because it is very COFCO, the largest Chinese concentrated, we company involved in the Soy from a region known chain, also ranks among as “Matopiba”, which believe that this is the largest exporters of soy comprises the states of an opportunity for to China, with a 7% share. Maranhão, Tocantins, Piauí, In Matopiba, COFCO is the and Bahia, carries the China to reduce seventh largest exporter, highest risk of deforestation. this impact responsible for 6% of This area contains the exports. Cerrado biome, where soy cultivation is expanding In January this year, COFCO most in Brazil. chance that soy cultivated president Jun Lyu surprised in Matopiba is associated the World Economic Forum It is also the region most with deforestation. in Davos by urging the threatened by deforestation. international community Forest conservation group RESPONSIBLE COMPANIES to join efforts to combat Imaflora estimates that deforestation. In an article, soy production in Matopiba The Trase study also Jun highlighted the impacts grew 310% between 2001 showed that although of the soy production chain and 2017. The EU buys most hundreds of companies on forests and the need to of its soy from Matopiba. are involved in the Brazil- protect the Brazilian Cerrado. China soy production chain, According to Trase’s just six account for 70% of “Efforts against calculations, there is an 81% the volume exported from deforestation would gain

28 Tracking China’s soy and beef imprint on South America Brazilian soy producing regions’ exports to China and deforestation risk (2013-2017)

Exports to China (million tonnes) Deforestation risk

40 South Region 1

26 Mato Grosso 12

8 Matopiba 81

0 10 20 30 40 50 60 70 80 90

significant momentum if the Brazilian association of more emerging market soy and corn producers, players in both producing Brazil lost 11 million tonnes and consuming countries 95% of crops worth roughly R$ got behind sustainable 17 billion (US$4.4 billion) as commodities,” he wrote. over 95% of a result of heavy rains and Chinese meat lengthy droughts. Vasconcelos has seen a imports come from growing concern about Brazil, Uruguay, “For quite some time we deforestation in supply Australia, Argentina have been warning that the chains among Chinese and New Zealand. biggest problems that can companies. “We are very happen in our non-irrigated enthusiastic about COFCO’s agriculture are a lack of position. It is important that water or too much rain,” the sector takes a position said Assad. and works to combat Climate Observatory. deforestation,” he said. Researchers argue that Without standing forests, growers should use areas evapotranspiration – where Companies like COFCO are that are already degraded, vegetation captures and also concerned with damage which in the Amazon and pumps water into the to their reputations and the Cerrado total over 30 atmosphere – decreases perceptions of shareholders million hectares. dramatically. The rains and consumers. Experts created by the Amazon believe that being associated “This is land more or are dwindling and no with deforestation could less the size of Brazil’s longer reach the Cerrado, negatively impact the growth agricultural production that for example, endangering of Brazilian soy in new is abandoned and in the harvests. Persistent rains markets. process of degradation,” are just as harmful. said Eduardo Assad, a Studies have shown researcher at EMBRAPA, a As deforested vegetation that deforestation is not state-owned agricultural decomposes it also releases necessary to increase research company. greenhouse gases (GHGs). production. Soybean In 2016, Brazil became the production soared 312% CLIMATE CONSEQUENCES world’s sixth largest emitter between 1991 and 2017, of GHGs. That year, half while planted area Deforestation is already the 2,278 billion tonnes of expanded 61%, according changing rainfall patterns. carbon it emitted resulted to data from the watchdog According to APRASOJA, from deforestation.

29 Photo: Richard Walker

Manuela Andreoni US-China trade war raises fears of deforestation in Brazil

Chinese buyers For years, Arnaldo Carneiro The strategy worked better turn to Latin stuck to his master plan in Europe. In 2015, seven to contain deforestation in European countries signed America for soy Brazil. the Amsterdam Declaration following tariff hike committing to support Carneiro, who directs Global private sector initiatives Canopy, a non-governmental against deforestation in their organisation, demonstrated production chains. the complicity of importers of Brazilian soybeans in “Europe is a slightly more the degradation of the conscious market,” said environment. He implored Carneiro. “[They are] them to purchase only concerned with impacts on from farmers who could the front line.” guarantee they did not clear land for cultivation. Now, however, Carneiro’s

30 Tracking China’s soy and beef imprint on South America strategy has suffered a big period in 2017, according vegetation is not necessarily setback that has renewed to official figures. Demand illegal. According to Brazil’s concerns for Brazilian was so high that Brazilian Institute of Forest and forests: the US-China trade reserves have almost ran Agricultural Management war. out. and Certification (IMAFLORA), there are 103 million TRADE SPAT IMPACTS All this could significantly hectares of unprotected change how international natural vegetation in Brazil – The world’s two largest markets push for less land that can be deforested economies began to impose deforestation in Brazil. legally. tit-for-tat tariffs on a range of imports in March 2018. Chinese companies Carneiro’s work used to China hit US soybeans – a tend to be less focused involve convincing the heavily traded commodity on the environmental Europeans not to deforest – with a punitive 25% levy. consequences of meeting land even the Brazilian Since then, Chinese demand their country’s soy demand. government considered for Brazilian soy has spiked. This worries Carneiro. it lawful to clear. But it is different with China. The trade war also kick- “China is very concerned started a game of musical with the food security of “Europe wants us to chairs between soybean its population,” explains deliver zero deforestation purchasers and producers. Carneiro, who regularly in commodities,” explains talks to Chinese companies André Nassar, president of Chinese buyers have about anti-deforestation the Brazilian Association increasingly switched to commitments. “They are of Vegetable Oil Industries Brazil to avoid the high much less concerned with (ABIOVE), which includes tariffs imposed on US environmental problems in major traders like Bunge and products. Meanwhile, other countries. What they Cargill. “The Chinese will not European dealers have do not want is to be involved ask us for more than we are flocked to the US as prices with any illegal activity.” delivering now.” slumped for their soybeans, which flooded the market After all, clearing natural Though varying standards after losing eager Chinese customers.

Historically, China has accounted for approximately one-third of US soybean consumption. Chinese people have increasingly stronger purchasing power and want to eat better. Soybeans play an important part in food production since they are fed to Chinese pigs.

In June 2018, 37% of soy imported to Europe came from the US, an explosive increase compared to 9% the previous year. At the US President Donald Trump and same time, the volume of Chinese counterpart Xi Jinping met at the G20 in 2017, prior to kicking- soybeans exported from off a trade dispute that has lasted Brazil to China grew 15% over a year from January to September Photo: The White House 2018 compared to the same

31 Forest Non-forest nature reserve Agriculture and Livestock Area

1987 1997

between buyers of Brazilian producers to increase Confederation of Agriculture soy are a concern, some production in order to and Livestock (CNA), has organisations are fighting to absorb as much of the already detected some close the gap. Rose Niu, who excess demand as possible. excitement in the market leads the department of This pressure could result in about expanding soy conservation at the Paulson further deforestation since production. But for now, the Institute in Washington DC, soy yields are increased by confederation is advising acknowledges the difference expanding the planted area. a cautious approach for between Europe and producers who want to China, but says efforts are Brazil is about to replace the invest with an eye on underway to drive change. US as the largest producer Chinese demand. of soybeans in the world. “In the past three years, There are 33 million hectares “This movement creates several organisations of soybean plantations – major uncertainty. It (including our institute) an area equivalent to the guarantees a short-term have been working with size of Malaysia. This is increase, but there is a risk soybean traders for almost triple the area under in the medium- and long- China to adopt more cultivation two decades ago. term that something could stringent environmental happen and the producer requirements in trade with Brazil is not the only country could end up with a lot South American countries,” in the region facing pressure of soy on his hands,” says Niu wrote in an e-mail. “I to produce. Argentina and Pereira. hope that traders in China Paraguay are also major will do as good a job as producers of soybeans. In Pereira foresees a less the Europeans in the near 2016, the three countries significant increase in future.” combined produced nearly planted area, around 4%. half the soy consumed But the market suggests the DEMAND DRIVES worldwide. potential increase is greater. EXPANSION For example, SLC Agrícola, Pedro Henriques Pereira, one of the giants of the The trade war has a business intelligence Brazilian agricultural sector, encouraged Brazilian adviser at the Brazilian announced a 7% expansion

32 Tracking China’s soy and beef imprint on South America 2007 2017 in its area planted with concentrated in this region. prepare it for farming, soybeans for the coming Yet since the 1970s, the thereby obtaining higher season. Cerrado has lost nearly half prices. of its natural vegetation to “Our main concern is that expansion of agriculture and According to Carneiro, creating such large demand pastures. activity should only increase in a short space of time on already degraded can cause deforestation According to data collected land, eliminating the need and conversion of natural by Trase, a global platform to deforest. But simple vegetation,” says Edegar de that monitors commodity economics mean the Oliveira Rosa, coordinator production chains, an danger remains. “They clear of the Food and Agriculture estimated 3.5 million the forests because it is Programme at WWF-Brazil. hectares of soybeans have cheaper,” he explains. been planted in areas of For the most part, the Cerrado that were covered ABIOVE’s Nassar plays down Amazon is protected from by native vegetation 15 years the risks. He says that even this hunger for more planted ago. though deforestation is still areas. Since 2006, a pact a problem, it is much less called the Soy Moratorium Land in the Cerrado is serious than it used to be. between producers and significantly cheaper than Data from ABIOVE shows environmental activists has in other regions where that deforestation caused by prevented the deforestation the soy industry is more soybean farming decreased of tropical forests to established, like southern from 27% per planted produce soybeans. Brazil. This means that it is hectare between 2002 and not the planting of soybeans 2007 to 7% over the past The danger lies mostly in itself that concerns four years. the Cerrado, a savanna- environmentalists, but also like biome with rich real estate speculation by “We support having no more biodiversity that is large rural property owners. deforestation in the chain,” essential for balancing Landowners may try to explains Nassar. “But we Brazil’s ecosystem. Soy capitalise on the expanding have to see this as a process cultivation is overwhelmingly market to clear land and of transition.”

33 Deforestation in northern Argentina has slowed but efforts to halt it further are woefully underfunded. Photo: Greenpeace Argentina

Martin De Ambrosio Stark images show soy-linked deforestation in Argentina

Greenpeace report shows rapid deforestation in Argentina’s Chaco as forest laws prove ineffective

Argentina exports soy to statistically – the extent of campaign, who added that China that is associated with forest loss in four Argentine the organisation works in deforestation. provinces, where 112,766 the provinces of Santiago hectares were deforested in del Estero, Salta, Chaco and When Chinese soy demand 2018. Of those, 40,965 were Formosa, which account and that of other countries in areas where industrial for 80% of Argentina’s increases, the agricultural exploitation is prohibited or deforestation over the past frontier tends to expand restricted by law. 30 years. at the expense of native forests. All in violation of the “We see the before and Greenpeace attributes Forest Law that sought to after to verify if there deforestation to the advance preserve them. is a change in land use, of the agricultural frontier, or deforestation,” said mainly for soy cultivation, A study by Greenpeace Hernán Giardini, head of but also livestock. Since the records – visually and the Greenpeace forest enactment of the Forest

34 Tracking China’s soy and beef imprint on South America Law at the end of 2017, Salta. 01/2018 2.6 million hectares have been deforested, 840,000 of which were supposedly protected.

The Rosario Board of Trade estimates that 17.6 million hectares of plantation will yield around 55 million tonnes of soy in the 2018- 19 harvest. This would represent a 27.5% increase on the previous period. Salta. 02/2018 Production of wheat, corn and other cereals has also showed an uptick since 2015. Most soy is exported. Argentina consumes scarcely any.

HALF FULL OR HALF EMPTY?

Argentina’s decade old Forest Law had been viewed optimistically and Photo: Greenpeace pessimistically in almost equal measure. There are facts to justify both positions. Santiago del Estero. 02/2018

Since the law came into force, the rate of forest loss has slowed by half from 300,000 hectares per year to around 150,000, but conservation is still woefully underfunded – it receives on average 5% of the budget it should under the Forest Law. Meanwhile, deforestation continues in prohibited areas, owing to provincial Santiago del Estero. 03/2018 exemptions.

“Some owners present silvopastoral [also known as agroforestry] plans and then we see that in reality more trees are taken,” says Juan Pedro Cano, director of forestry at the Environment and Sustainable Development Secretariat. “They leave only patches of Photo: Greenpeace trees.”

35 Another issue is how far the area devoted to soy can US$50,000 grow in Argentina. “It’s hard to know. There the fine for illegally clearing 500 hectares of forest are many areas where it could still be planted,” said Giardini, adding that genetic modifications to the Cano said Greenpeace’s clearing 500 hectares, crop would enable it to be numbers match official a figure that doesn’t planted in areas where there data and agreed that the discourage,” he says. is low rainfall. expansion of the agricultural and livestock frontier, not For this reason, Greenpeace Giardini added that scientific just soy, drives deforestation. presented a bill to reform solutions for increasing the penal code and to productivity seem to “Beyond demand, it’s make environmental crimes exist only for large-scale commodity prices that offenses that can lead to industrial producers, not accompany deforestation,” imprisonment. for rural smallholders or Cano says, claiming that agroecological farmers. when soy prices go up, GLOBALISATION agricultural activity and “We don’t adapt to the deforestation also rise in the Gustavo Girado, an ecosystem, the ecosystem rush to capitalise. economist specialising in adapts to us,” he said. relations with China at the Argentina’s constitution gives National University of Lanús, The question of how to the provinces responsibility said directly correlating solve demand for a product, to manage their own natural Chinese soy demand with whose cultivation interacts resources, even if national Argentine deforestation is with sensitive forest minimum budget laws are a mistake, as much China- ecosystems as the world’s enacted that constrain bound soy travels via the US. food demand grows, is an choices, as has been the urgent one. case with forests and glaciers. Giardini said that consumer- led initiatives and voluntary “We want to stop thinking corporate standards could about forests as a be a way forward. hindrance to economic production,” said Cano, who We don’t adapt to “There was a commitment is enthusiastic about a new of that type by grain dealers system of alerts based on the ecosystem, who did not buy soy from satellite information that the ecosystem the Amazon. That could is shared with provincial be extended to the Chaco authorities. adapts to us area. Don’t buy unless zero deforestation is guaranteed,” Giardini said that when illegal he said. deforestation is detected companies incur measly “The ships come out with “It will inevitably have to be fines, if they have to pay the raw material and then done if you want to comply anything at all. they are told which port to with the Paris Agreement on go to,” he said, adding that climate change. In Argentina, “It depends on each when prices come down, changes in land use and province, the fine, or the producers look to plant livestock generate more type of infraction. Fines other products. “For ten than half of the greenhouse of two million pesos years we have sold them the gases that the country (US$50,000) are paid for same thing.” emits.”

36 Tracking China’s soy and beef imprint on South America Sarita Reed, Vinícius Fontana Soy demand pushes agribusiness to the banks of the Amazon

Indigenous people complain of trade route’s disruption and fear migratory pressures and pollution

The Amazon Basin is the largest maze of waterways in the world. For millennia, its rivers, creeks, and bays have served as thoroughfares for the people and animals A Hong Kong-registered vessel docks on of the forest. Today, the Bacarena port in Brazil’s Pará state. The route heaviest traffic in the is used more frequently to transport soy. region still comes from Photo: Vinícius Fontana river dwellers’ canoes and small boats. But larger ships are becoming increasingly months. 39 of these (43%) common. were China-bound.

The contrast between 28% NEW ROUTES convoys of barges, or the growth in comboios, and the soy exports from The comboios leave Itaituba untouched Amazon and Santarém in Pará, ports in the landscape is striking. As they which are closer to the soy navigate the rivers of the Amazon basin producing mid-west region northern state of Pará, they of Brazil, and travel downriver create waves that shake to the ports of Vila do Conde small, stilted houses and growth in soy exports from in Barcarena and Santana canoes tied up to piers. They ports in the Amazon Basin at in neighbouring state of carry all kinds of products. 28% between 2017 and 2018. Amapá. From there, cargo is Most carry soybeans At other Brazilian ports, the transferred to larger ships that destined for China. increase was 22%. travel to China via the Panama canal. Use of this “northern route” is The northern route speeds growing fast and indigenous up shipping to China, the This route cuts transport communities near transit hub main importer of Brazilian costs. Itaituba lies 1,100 Itaituba are concerned about soy. According to data from kilometres from soy producing the contamination of the shipping agency Cargonave, city Sorriso, in the state local environment and their 89 bulk carriers departed of Mato Grosso, Brazil’s food sources. The Brazilian from the ports of Santarém, agricultural heartland. The Association of Cereal Barcarena, Santana, and Atlantic port of Santos, an Exporters (ANEC) puts the Itacoatiara over the past 8 alternative point of departure

37 with the Pará state public prosecutor’s office.

“The number of traffic accidents also climbs, and as more people from elsewhere arrive, so do child prostitution and drug trafficking,” she added.

The port facilities also impact Munduruku indigenous peoples’ way of life. The most affected live in Praia do Índio, a village about 10 kilometres from the centre of Itaituba.

“There are three ports right in front of my village,” says Alessandra Korap, a community leader in Praia do Índio. “Companies say there is no impact because the ports are on the other side of the river, but this affects our fishing area. When trucks reach the port, they fill up the silos and dust falls into the river. When we cut open A great share of Brazil’s commodity exports are destined for China. Photo: Sarita Reed the fish, their bellies are all ruined.”

in the southeast, is connected However, the creation of According to NGO Fase, other by approximately 2,000 infrastructure that supports consequences of the route kilometres of road. A large heavy shipping traffic in include land speculation, comboio consisting of 12 the middle of the Amazon noise pollution, and pesticides barges has the same cargo has led to rights violations, leaking from the barges. As capacity as around 900 trucks. environmental damage and the forest and the rivers are inconsistent environmental increasingly overrun by port China’s eagerness to import licensing. companies, native inhabitants Brazilian soy quicker has may be forced to move to grown since the trade war SOCIAL AND cities with little infrastructure. with the US that began in ENVIRONMENTAL IMPACTS In most cases, this process 2018. Last year, Brazil set condemns river dwellers and new records for soy exports In Miritituba, Pará, the first indigenous people to poverty to China, the destination of social impacts were felt with and marginalisation. 82% of the total, according the influx of construction to ANEC. This has created workers from other regions. Brazilian law states that demand for new supply lines. affected communities “The flow of jobs increased, must be offered public Agribusiness strategists but there may be consultations on the impacts say inland waterways help unemployment because of infrastructure projects. decongest crowded roads of mass layoffs after The International Labour that link midwest regions to construction is finished,” Organisation’s convention Santos and Paranaguá. said Ione Nakamura, state 169, which Brazil has ratified, prosecutor for agrarian law mandates that indigenous and

38 Tracking China’s soy and beef imprint on South America quilombola communities must right next to the bustling Porto demonstrates China’s role be afforded public hearings on do Grego, a boarding point as a major commodities projects. for passenger vessels that buyer and investor in global travel down the Amazon. It infrastructure. The Munduruku, however, is also home to two fishing claim that they were not communities. The Chinese are not only consulted on the Cianport and buying Brazilian soy, but Turia River ports. According to Joaquim Cabral, producing it in and exporting a federal prosecutor in Amapá, it from the country. Chinese “The companies are trampling high commodity prices meant companies already use ports on the consultation protocol the terminal was overloaded in the Amazon to sell their we created. The city of Itaituba in the rush to capitalise. own products. This is true of is full of ports, and soon they’ll “Sometimes, the thirst for COFCO, China’s largest grain move on to our land,” says profits brings harm to the dealer and already the fourth- Juarez Saw Munduruku, leader region.” largest soya exporter in Brazil. of the Sawré Muybu tribe. According to COFCO, a Prosecutors also allege that private terminal owned by environmental risks were not the company in Santos hosts properly assessed. The State its main operations. But in Department of Environment 2018, Hidrovias do Brasil, and Sustainability (SEMAS) Sometimes, the which operates a cargo granted Miritituba an station in Miritituba, added environmental license. But thirst for profits clauses to its contract with the public prosecutor’s office brings harm to the COFCO to provide cargo said the large number of transfer, river shipping, and joint ventures and potential region port operation services. The damage means federal agency contract was extended to IBAMA should have evaluated 2031 and allows an increased the project. FROM THE TAPAJÓS TO maximum grain volume of THE PACIFIC 9,630 tonnes. “We need to understand that environmental licensing for Many new ports in the Chinese are also interested ECTs (cargo transfer stations Amazon region are simple in expediting the flow of or ports) cannot be viewed in ECT installations. Grain dealer soy through the northern isolation,” said Nakamura. “Are Bunge owned the first station passage by improving road all these ventures feasible for that began operations in and rail infrastructure. One a watershed considering that Miritituba in 2014. Since then, such project is the Paraense there are also several other several companies have Railroad, which will connect highways and dams in the expressed interest in building southeastern Pará to the region?” their own. port of Barcarena. Another, Ferrogrão, will link Mato In Amapá, near the port of “We are not talking about Grosso to Itaituba. Santana, an endpoint on just one but rather a series the internal soy shipment of ventures across the entire Both projects are still route, the risks posed by port state of Pará. At least 30 want undergoing feasibility developments are already to establish [transfer stations] studies, but authorities have evident. From a boat, the ruins in the Miritituba region alone,” confirmed Chinese investor of a port belonging to London- says Nakamura. interest. Website Relatório based mining company Reservado published an AngloAmerican that collapsed According to Diana Aguiar, an article noting COFCO’s in 2013 are clearly visible. advisor to Fase and author interest in Ferrogrão. of the study The geopolitics The disaster killed six people of Chinese infrastructure COFCO declined an offer and could have had even in South America, the to be interviewed for this greater human costs. It sits new logistics corridor article.

39 Aldem Bourscheit São Luis megaport conflict intensifies

Demolitions of traditional communities’ houses continue amid protests and investigations into the legality of the São Luis project

Demonstrators warned police that there was a pregnant woman among them. They stood in front of a queue of diggers, trying to protect their homes against How can the repossession by a private company. But the police state grant a pushed through to let the public deed to the machines pass and soon used pepper spray. community and then, years later, The pregnant woman staggered away from the someone appears diggers, her hands over her claiming to be eyes. the owner of the It was August 12, 2019. area? Residents of the Cajueiro community in the Brazilian Amazon were continuing a struggle they have waged from the Industrial and since 2014. They are trying Commercial Bank of China to save their houses from a (ICBC), aims to facilitate the government-authorised plan export of Brazilian iron ore that will dispossess them – and soy. a megaport linking São Luís, in the Amazonian state of There are other ports in Maranhão, to the world’s the region, but this would markets. be the first to be operated by a company from China, original 250 inhabitants live The São Luís Port the main buyer of Brazilian there. Only seven lots have project, headed by commodities. not yet been repossessed. China Communications Construction Company REPOSSESSION Last month, more than 100 (CCCC) and the Brazilian Brazilian and international company WPR-São On that August day, 22 tracts signatories concerned about Luís Gestão de Portos e of land were repossessed authorities’ treatment of the Terminais, and part-financed and even more houses community sent a letter in by a US$2.6 billion loan destroyed. Today, 34 of the support of Cajueiro residents

40 Tracking China’s soy and beef imprint on South America mining and agricultural products from the Amazon and Cerrado regions.

The project reveals conflicting visions for the Amazon – those who see it as a new frontier for industrial and agricultural development, and those view forest protection as vital. A stone indicating the construction site The Amazon has already of the São Luis port lost 18% of its forest Photo: Ingrid Barros cover, while half of the Cerrado savannah’s original vegetation is gone. Preserved areas are often home to indigenous people, quilombola communities of slave descendants, and small rural producers like those defending Cajueiro.

“There used to be community members who had lived there together for decades, who had a good life and helped preserve the forest,” explained Ademar Pereira, age 70, one of the villagers who lost his home.

“Now, it is complete sadness.”

INVESTIGATIONS AND PROTESTS

Destruction of a house in Construction of the port the Cajueiro community on has already deforested August 12 to make way for the São Luis port project. an area equivalent to 200 Photo: Ingrid Barros football pitches. In order for the project to progress, it must displace more families from Cajueiro, a community to Leilani Farha, the UN’s federal prosecution services dating back to the mid- special rapporteur for housing. questioned its legality. nineteenth century.

The conflict between São Luís Port is part of the Houses at the site have the police and the “Northern Arc” initiative, a been demolished since community demonstrated recipient of a flurry of public 2014, some with, others the government’s brutal and private investments without legal authorisation, commitment to ensuring in ports, railroads, and as revealed in the that the project goes ahead, highways designed to investigation for a recent even as the state and expedite the transit of journalistic investigation

41 entitled Besieged by Progress. Some residents have been threatened by hired gunmen, according to the Pastoral Land Commission.

Criminal activity could underpin much of the venture, as many land purchases and sales are dubious.

Investigations by the Maranhão public prosecutor’s office indicate that a criminal operation has been forging titles for public land in order to enable to work on Carlos Augusto Barbosa, a fisher who lives in one of infrastructure projects in the the communities in Cajueiro fixes a net for fishing area surrounding São Luís. crab, which are increasingly scarce in the region. In April 2019, prosecutors Photo: Ingrid Barros seized enough computers and documents to fill four pickup trucks. houses demolished. The land title scheme appears to be led by a group “In a democratic state, comprised of companies, 18% the parties involved in deed registry offices, and of the Amazon proceedings should be public servants, according region’s forest summoned and informed to Haroldo Paiva de Brito, prior to actions such as cover has already who specialises in agrarian these,” Dias said. “The conflicts at the Maranhão been lost repossession was not in state prosecutor’s office. line with this process, and treated the residents like “How can the state grant for the Jesus do Cajueiro squatters.” a public deed to the Residents Union, land community and then, years repossession for the port Days later, as they later, someone appears was illegal since it was not demonstrated against claiming to be the owner of determined who owns the authorities’ brutality, the area?” he asked. land. protesters, residents and former residents of Cajueiro “From what we have found, Nor were residents given were forcibly pushed private individuals have any warning that they back from the Palácio dos usurped public land and sold would be removed. Dias Leões, the seat of the local it to companies linked to the said they began to be government, by police using port construction project. This removed on Monday 12, but rubber bullets and tear gas. can lead to the annulment the court order authorising of the private land deed and repossession only arrived The Ordem dos Advogados project licensing.” the following day. do Brasil in Maranhão is investigating the case. NO SLOWING DOWN Taken by surprise, residents soon found themselves Asked whether the According to Ana Carolina and their belongings in repossession was Carvalho Dias, a lawyer the street and with their authorised by the state

42 Tracking China’s soy and beef imprint on South America says it is investigating infrastructure around allegations of violence the world have been met against Cajueiro residents with opposition on the and protestors, but didn’t world stage, with top US explain why repossessions officials arguing that China took place without warning. is competing in a new Cold At the time of publishing, War-style bid for political CCCC hadn’t responded to leadership. requests for an interview. Nor was it possible to make “Although the intent of this contact with WPR-São policy has been largely Luís Gestão de Portos e economic, Chinese leaders Terminais. understand that this global expansion has geopolitical GRAND CHINESE DESIGNS ramifications,” Armony said.

Former president Michel On the environmental and social Temer secured ICBC finance impacts of projects, China has for the São Luís Port in demanded more transparency September 2017. and respect for local legislation in its Latin American projects, Such investments are part however strict laws may be, of the Chinese government’s Armony said. policy encouraging domestic companies to expand However, he noted problems judiciary, governor Flávio their business overseas, including the violation of Dino, a member of Brazil’s according to Ariel Armony, indigenous and traditional Communist Party, tweeted: director of the University people’s rights in projects “the military police cannot of Pittsburgh’s Center for with Chinese involvement in simply refuse to carry out International Studies. the region: a court order. There have been several attempts As well as encountering “There is a dark side of at mediation, which resistance locally, Chinese China’s expansion in the unfortunately were not investments in developing global South.” successful. It is not up to the governor to revoke or suspend a decision by another branch of government”.

WPR-São Luís Gestão de Portos e Terminais is offering those removed from the Cajueiro community “a new house, employment, temporary emergency financial assistance, and food assistance”, according to a pamphlet distributed by the company. It does not give details, or state how long benefits will be offered. Land cleared for the São Luis port In a statement, the Photo: Ingrid Barros government of Maranhão

43 A new report by Carbon Disclosure Project (CDP), reveals the link between Chinese financial institutions and deforestation for soy cultivation in Brazil. Photo: IBAMA

Lili Pike Can banks in Beijing stop deforestation in South America?

Report calls for a rethink from financial The report by the Carbon institutions as deforestation linked to Disclosure Project (CDP) reveals the link between Chinese soy imports increases Chinese financial institutions and deforestation, via their clients in the soy business. Chinese banks have come China is the world’s largest under fire in recent years importer of soy and in To date, these institutions for continuing to fund coal- the wake of the trade war lag behind international fired power plants overseas it has increased imports best practice in addressing despite the unfolding climate from South America. This deforestation. But CDP argues crisis. Now, a report makes is expected to drive a new that they can play a key role the case that Chinese wave of deforestation in in pushing for sustainability in financial institutions should South America, imperiling the sector going forward. also address a less obvious the region’s biodiversity and perpetrator: the soybean. critical carbon sinks. So can banks in Beijing

44 Tracking China’s soy and beef imprint on South America prevent deforestation in South America?

CUTTING TREES TO GROW SOY To make up for the US shortfall, China’s soy imports were associated with 49,000 Brazil would have to deforest 25 to hectares of ‘deforestation risk’ in 2017, according to 57 times the amount it did to meet the watchdog Trase. This Chinese demand from 2013 to 2017. represents 46% of all the area in Brazil at risk of deforestation because of soy. goals because 10-15% of all 34% of the Chinese financial The rate of deforestation is greenhouse gas emissions institutions’ loans to the sector expected to rise as China come from forest degradation – at least US$2.1 billion – are looks to Brazil to replace its or loss. exposed to deforestation risks. soy trade with the US. Brazil A few major Chinese banks was previously China’s second The UN Sustainable provide the bulk of loans to largest source. According to the Development Goals also aim the sector, with Bank of China CDP report, to make up for the to stop deforestation and at the top supplying 32%. US shortfall, Brazil would have restore degraded forests to deforest 25 to 57 times the globally by 2030. ADDRESSING amount it did to meet Chinese DEFORESTATION demand from 2013 to 2017. In response to this global call, efforts have been made So far, these banks have not This trend is significant from to prevent deforestation. In developed any policies to a climate change perspective 2018, 50 investors managing address deforestation, the because Brazil is the world’s over US$5.6 trillion in assets report finds. Only eight of sixth largest emitter of formed a coalition with the institutions analysed take greenhouse gases. One half companies to push for zero environmental factors into of its emissions come from deforestation in Brazil’s account in their decisions, deforestation. The report states Cerrado region. and those that do focus on that agriculture is the main screening key polluters as driver of deforestation, and soy As these efforts increase defined by the Ministry of cultivation is one of the main alongside national government Ecology and Environment, not culprits. regulation and direct climate on deforestation. impacts, companies are DEFORESTATION RISKS being pushed to decrease Although Chinese banks are operations in areas of not currently aware of their CDP argues that the high deforestation risk. In exposure to risk or taking environmental impact of soy CDP’s 2017 survey, 32% action, CDP makes the case cultivation presents risks for of responding companies that they could influence their both Chinese companies reported having already clients to take action. buying the beans and the experienced detrimental institutions financing them. impacts associated with the Some financial institutions Global calls to address production or consumption outside of China have already deforestation are putting of forest-risk commodities, been putting this theory to the pressure on banks and including soy. test. HSBC requires customers companies and could affect to acquire certifications of their business. To the extent to which global zero-deforestation companies are affected by from the Roundtable on The Paris Agreement included these risks and changes, their Responsible Soy Association forest conservation and financiers are also affected. (RTRS) and will discontinue restoration as one of its key According to the report, business in the case of non-

45 isn’t directly impacting them.”

Regulatory and corporate 10-15% action to address deforestation is on the rise, of all greenhouse gas emissions come from forest but most companies are still degradation or loss pursuing short-term thinking about their bottom lines.

Deforestation changes rainfall patterns, which has already compliance. JP Morgan Chase led to R$17 billion (US$4.4 & Co requires the same. billion) in crop losses in Brazil. Droughts and rainstorms are While good on paper, harbingers of climate impacts these policies have limited to come, but since companies effect, according to Isabel Based on our grow soy globally, they are Nepstad, program manager able to weather short-term for Solidaridad’s China research and regional supply fluctuations, Sustainable Commodity Trade interviews, according to Nepstad. Program. “It is really hard for them alone to push this on shareholders Nepstad says government their clients because it is very are in a better action is needed to push easy for the Chinese company companies and financial to switch and go to another position to institutions forward. bank, especially a Chinese Regulatory efforts may bank that doesn’t have these engage soy increase in years to come, policies,” she said. companies bringing the urgency of the issue to the fore and requiring However, if more banks were financial institutions and to join together in adopting companies to act. these policies, they may have “Based on our research and more influence. interviews, shareholders Ahead of the international (institutional investors) are in a negotiations to preserve The CDP report recommends better position to engage soy biodiversity COP to be that Chinese financial companies […] They also have held in Kunming, China in institutions first assess their considerable influence on 2020, countries have begun deforestation risk exposure, portfolio companies,” Sabrina discussing ways to address including requesting data from Zhang, the director of CDP deforestation linked to client companies on their China said. agriculture. soy supply chains, and then formulate policy responses as “Some institutional investors Zhang said: “If the Chinese international banks have done. in China who are seeking government starts to a presence in international advocate, regulate and They recommend that capital markets are also develop guidelines for banks prioritise client motivated to increase their sustainable agricultural companies active in high sustainable investment.” supply chains, and starts to deforestation risk sectors and ask financial institutions to incentivise them to eliminate ROLE FOR GOVERNMENTS incorporate deforestation deforestation from their considerations into their supply chains. Whether financial institutions financial decisions, that have enough of an incentive to would provide a strong driving Chinese shareholders can also take action in the short term force for both companies play a role as they currently depends on how acutely they and financial institutions to have higher exposure to feel risks. So far, Nepstad says, implement changes in line deforestation risk than banks. “They don’t see the risks and it with the government.”

46 Tracking China’s soy and beef imprint on South America Wang Chen Can the ‘tiger nut’ solve China’s soybean crisis?

The tuber of Cyperus esculentus, known as the tiger nut, could ease China’s reliance on soy imports

In the village of Jiangu in southwest Hebei, Wang Sanxiu is persuading visitors to try his tiger nut milk. The Photo: Arco Images GmbH 61 year old points proudly to photos on the wall, explaining how he came to produce the liquid, which is a little sweeter than soymilk, from a crop of Cyperus esculentus he planted last year.

Not many people know about the milk of the tiger nut – which gets its name from its streaky surface – and so Wang tells everyone that not only do these tubers have a higher oil yield Wang Sanxiu and his Cyperus farmland. than soybean, but the rest Photo: Wang Chen of the Cyperus plant makes good livestock fodder too.

“I just happened to hear searching for solutions to SAVING THE OIL CROP about it,” Wang says, “and I the crisis, from soil-fingered MARKET realised the whole plant is Wang in the fields of Hebei valuable, and could make to white-coated technicians As far as Wang is concerned up for China’s soybean at top universities. the tiger nut is a miracle. After shortage.” retiring from the construction “A lot of agricultural industry last year, he set up The China-US trade war, researchers are interested in Beijing Youzhili Agricultural which started in 2018, has the tiger nut at the moment. Technology. In March 2018, created huge shortfalls in Universities want to send his new company planted China’s soybean supply. research students here for tiger nuts on almost 400 mu Many people have been placements.” (27 hectares) of sandy rented

47 soil in rural Hebei. For most soybean stimulus plan” at of the year since, he’s been home, according to a key busy either in the fields or the document issued by the storehouses. government in February 2019. That means expanding China-US trade frictions soy planting, promoting new worsened shortly after Wang varieties, new technologies planted his crop, with China and mechanisation, as well announcing in April 2018 a as increasing subsidies for 25% tariff on US soybean soybean farmers. An extra five imports. When Wang saw this million mu (330,000 hectares) in the media, he knew he’d of soybean and oil crops will made the right choice. be planted in 2019, according to an official statement. Soy is the main ingredient in cooking oil and animal fodder, The tiger nut is one oil crop with tens of millions of tonnes with the potential to be a of its meal powering the farms substitute for soybean. that send fish, meat and eggs onto the Chinese dinner table. THE ‘MAGICAL’ TIGER NUT? Up to 1995, China was a major exporter of soy. But since then Wang harvested 800,000 increasing consumption and jin (480,000 kilogrammes) Part of Wang Sanxiu’s the expansion of livestock of tiger nuts last year, far tiger nut yield. farming has caused domestic more than he’d expected, Photo: Wang Chen demand to rocket. and he now employs ten villagers to help with planting, Currently, over 85% of weeding, picking, cleaning and soybeans on the Chinese packaging. He reports fielding the tuber could reduce reliance market come from outside daily phone calls from buyers on soy imports. A number the country. With more than after the autumn harvest. of provinces present said 900 million tonnes imported This year he’s planning to they would encourage rapid in 2017, China is the world’s greatly increase his tiger nut expansion of tiger nut planting biggest importer of the crop, plantation from 400 mu to to help the process along. accounting for 65% of the 15,400 mu, by renting more global trade. About one third sandy land near the city of Some hail the tiger nut as the of those imports came from Zhangjiakou in northern Hebei. ideal alternative to soy, but the US. But the trade frictions others wonder if its benefits caused China’s 2018 soybean The tiger nut is not a wholly have been exaggerated by imports to fall for the first new arrival in China. Having those who stand to benefit. time in seven years, by 7.9% originated in Africa and the on the previous year, with a Mediterranean, it first came to Cyperus esculentus has a 49.4% plummet in imports the country in 1952, courtesy chequered history. After a from the US. of the Chinese Academy of short-lived planting craze Sciences’ Institute of Botany. in the 1970s, tiger nuts rose China is trying various The institute has favourably to prominence again in the methods to stabilise the compared the quantity and 1990s during a push for crop market. It has been increasing quality of the oil of the tiger diversification. Back then tiger soy imports from South nut to that of the olive. nut sceptic Xu Yuanlin was American countries such as in his thirties, and working Brazil and Argentina, thereby In November last year, the on a farm in Shaanxi that increasing deforestation. In Ministry of Science and planted tiger nuts on 27 mu 2018, 68.8 million tonnes Technology’s Department of (2 hectares) of mudflats. came in from Brazil, up Rural Development held a 15 million tonnes on 2017. seminar on innovation in the Because the plant looked very It is also implementing “a tiger nut sector, discussing how similar to a weed common

48 Tracking China’s soy and beef imprint on South America four times as much oil as the soybean, and twice as much as canola. In August 2018, the same team announced the “Tiger Nut 2”, with a smoother surface for easy harvesting and a yield of up to 800 kilogrammes per mu.

Zhang Xuekun, deputy director of the institute, explained that large-scale planting of Tiger Nut 1 will start in the second half of this year, in Hebei’s Nangong. Planting of Tiger Nut 2 will take place next year, in Huangfeng, also in Hebei.

However, research advances can’t mature the tiger nut market overnight. Ecommerce platform Taobao lists less than 20 tiger nut products, mostly lightly processed packaged nuts and one type of tiger nut oil. These attract only occasional sales. on the mudflats, weeding promoting tiger nut planting was very difficult. And the is just going to mean lots of Wang Sanxiu’s mission for the tuber’s rough surface made farmers suffering losses.” year is to develop the sector, it tricky to pull out of the soil. by expanding the market for In the end, only 300-500 jin A YOUNG MARKET the tiger nut and its products. (180-300 kilogrammes) were His mobile rings often, and harvested – nowhere near Despite Xu’s concerns, Wang he says there are suppliers, enough to compensate for Sanxiu remains confident: processors and agents the costs and labour involved. “Planting tiger nuts makes use from around the country of barren sandy land and helps asking about partnership Xu decided he would never enrich farmers. And as the opportunities. plant tiger nuts again. Yet it technology develops, there’ll be was six or seven years before no problems with output.” In late March 2019 his the land was completely clear company obtained licenses of the plant: it can sprout A team at the Chinese for producing products from its tubers and has roots Academy of Agricultural including tiger nut oil and a which reach half a metre Sciences has been turning drink concentrate. below the surface – miss a technology on the tuber single fragment and it will itself. In January last year, “The trade war with the US return. after ten years of work, it is still going on, and our tiger announced the “Tiger Nut 1”. nuts can fill the gap left by “If you’re planting oil crops, Produced by using radiation soybeans,” said Wang. you’re better off with peanuts to increase desirable or sunflowers. They can grow mutations, the crop has a “The problem at the moment in sandy soil just like the reported net yield of 568 is that people aren’t aware tiger nut, but the technology kilogrammes of nut per mu of the tiger nut. Sales aren’t and the market is better – several times Xu’s yield in going to be a problem once developed,” Xu said. “Over- the 1990s – and produces they know about it.”

49 Photo: Divulgação

Cleyton Vilarino Chinese consumers can help drive sustainable agriculture in Brazil

Latin America With climbing rates of Summit in São Paulo. summit identifies deforestation and the likelihood of relaxed “If this change comes, it will opportunities rules on pesticide use, come from the demand and challenges in Brazil is faltering on the from these markets,” said path towards sustainable Caio Penido, president responsible food agriculture. The key to of the Sustainable Beef production a greener sector could Working Group (GTPS), on lie two oceans away in the importance of Asia and China, the largest importer the Middle East for Brazil’s of Brazilian agricultural trade. “It would be the perfect products. combination: we would be able to intensify [production Changing consumption in in] our degraded areas without China, where purchasing illegal deforestation, supplying power continues to grow, is food to this region.” essential to accelerate change in Brazilian agribusiness’ The fourth annual Latin production model, experts American event highlighted said at the Sustainable Foods the importance of

50 Tracking China’s soy and beef imprint on South America certification programmes the Portuguese acronym) to and sustainability in the food track deforestation in rural industry. The event noted landholdings. Meanwhile, opportunities for a sector that organisations such as the has sought to adopt practices Paulson Institute have been to protect the environment by working for years with soy investing in new technologies traders for China to adopt and pushing the government more sustainable practices. to offer more benefits for those who adopt sustainable In Belém, northern Brazil, NGO practices. Solidaridad Network convened a meeting of Chinese and However, Penido claims there Latin American soy trade is still resistance from many stakeholders focusing on producers because of the monitoring land use change Caio Penido, President of the costs and uncertainties of and controlling deforestation working group for sustainable improving sustainability. livestock. linked to soy production. Photo: GTPS “They ask; ‘what’s in it for Among the principles crucial me?’” he adds. to furthering these goals, they identified political will, At present, there would sustainable produce. improved transparency and seem to be few incentives traceability in the trade, and for food producers. But this “Someone needs to explain market pressure maintained could change if consumers in to Chinese importers that by companies committed to Brazil and abroad were willing few countries can offer these buying only from registered to pay higher prices. Since characteristics,” Penido adds. producers. China established its place as the country’s main trading WHY PAY MORE? “Chinese soy industry actors partner nearly a decade ago, are beginning to set in place producers say demand there According to Richard Lee, a framework and capacity could play a major role in the director of sustainability at the building for implementing transformation. multinational brewing group sustainable sourcing,” said Ambev, cost is key. Changyu Sun, an oils and According to a study by grains specialist at Shanghai- agriculture research institute “Consumers often say they based Wilmar-Kerry Trading EMBRAPA, approximately want [sustainable products], Co. Limited. 66% of Brazil’s territory is but will they be willing to pay made up of preserved native more?” he asks. Brazil offers several vegetation. A third of this sustainability certificates, total was identified within In China, there are signs that though producers still struggle rural private properties, which the time is ripe to transform to make the necessary means farmers have a big consumption habits. According investments to get them. They share of the responsibility in to a national opinion poll are considered very rigorous. preserving them. published in 2017, 73.7% of Chinese are willing to spend But this doesn’t mean Although the figures more for environmentally the industry isn’t growing. suggest a big challenge for friendly products. Consumption of certified Brazilian farmers, they also organic fresh produce, for show Brazil’s potential to Both governments and civil example, has grown 11% offer consumer products society groups have been between 2012 and 2017, consistent with environmental working to change habits too. from 337,000 tonnes a preservation. To date, The Brazilian government, year to 376,000 tonnes. however, the country has for example, adopted Sales of certified organic not managed to successfully the Rural Environmental industrialised products have market its potential for Cadastre (or registry, CAR in almost doubled in the period,

51 companies,” says Miguel Hernandez, regional director of Bonsucro, an internationally-recognised certifying body for the sugarcane sector. “Although the US and China are Brazil’s largest export markets, it is possible they will not be the destination for its sustainable produce, and the brands have the final say on where products go.”

NEW GOVERNMENT, NEW UNCERTAINTIES

Freire says Brazil needs strong public policies to protect its major food producing biomes: “Brazil Deise Caron, Certification Manager can more than double its of FoodChain ID, during the event. production without touching Photo: FoodChain ID a single hectare of land in the Cerrado and the Amazon, just by remediating unproductive and degraded areas.” from US$46 million a year to of the [economic] pyramid”, US$87 million, according to where there is less concern However, it appears that Euromonitor Consulting. with sustainability issues. “It’s these concerns do not align just a question of time”. with the policy orientation Deise Caron, certification of president Jair Bolsonaro. manager for FoodChain ID, According to Chinese customs Bolsonaro has threatened believes that the demand data, the country imported to withdraw Brazil from the for products certified for a twice the volume of soy Paris Accord and has worked commitment to sustainability from Brazil in October 2018 on efforts to backed out will soon expand. “We think compared to the same month of hosting the UN Climate that even China and the in 2017, jumping from 3.38 Conference this year. US have already increased million to 6.92 million tonnes. demand for sustainable Meanwhile, Chinese imports As a result, Brazil’s image products,” she said. of US soy fell from 1.33 million has been tarnished in tonnes in October 2017 to only international markets, Notable among the reasons just 66,900 tonnes in October Freire says. He recalls for the advance in responsible last year as the trade war Brazil gaining credibility consumption in China is the between the two countries by slowing deforestation growing middle class, said escalated. in the early 2000s, and by Augusto Freire, president of implementing policies like the ProTerra Foundation. In addition to government the soy moratorium, an trade policies, major brands industry commitment to zero “The middle class in China are also important actors in deforestation in the Amazon. is larger than Brazil’s entire stimulating more sustainable population. And they are production. “But now everyone is already paying more for concerned with what is going safer products,” says Freire, “The main engine of the to happen,” Freire lamented. recognising that consumption international markets “This is very bad for Brazil’s is still very small at the “base are food and beverage image.”

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