Enormous areas of natural vegetation in South America remain under threat from soy expansion. Achieving deforestation-free soy requires coordinated, sector-wide action, commitments and support from stakeholders across the supply chain.
While there has been progress – in the Amazon and the Cerrado, soy-related deforestation has fallen, while production has increased – more needs to be done to protect areas where deforestation for soy remains high. The Atlantic, the Cerrado and the Gran Chaco have not received the same degree of attention as the Amazon. The eastern region of the Cerrado (Mapitoba) has seen particularly high rates of deforestation, with nearly 40% of soy expansion between 2007-2013 at the expense of native vegetation.1 Concerted efforts need to be taken in all major production areas to protect native habitats and achieve more sustainable soy production.
Existing legislation allows enormous areas to be cleared legally. The Brazilian Forest Code requires landowners to maintain only 20% of land outside the Amazon under native vegetation. Paraguay’s Zero Deforestation Law has prohibited conversion of the Atlantic Forest since 2004, but does not protect the Chaco region. A 2019 study estimated that about 110 million hectares of forest in Latin America can be legally cleared,2 an area larger than the size of Colombia.
Furthermore, enforcement of the laws is weak. Recent publications for Paraguay indicate that close to 20% of deforestation in the Chaco is likely to be illegal,3 and a 2018 land use study in the Chaco province of Argentina indicated that much deforestation in the Chaco province of Santiago del Estero contravened Argentina’s 2007 Forest Law.4
Supply chain interventions have made an important contribution to the reduction in soy-related deforestation. But the vast majority of supply chain actors have yet to take action to reduce deforestation. The number of corporate commitments for soy is much lower than for other commodities, such as palm oil, timber and pulp (see diagram x). Global Canopy reported in early 2020 that 73% of companies and financial institutions with the most power to end soy-related deforestation through their supply chains have no commitment, and in 2019 some companies removed or weakened their commitments, or dropped their deadlines.5 Uptake of deforestation-free soy certification has so far been low. The global market share of certified soy is estimated to be between 0.2% and 6%, depending on which schemes are included. Most certified soy is destined for Europe; the Chinese market for certified soy is very small.6 Actors throughout the entire supply chain must step up efforts to promote zero-deforestation soy.
Governments in Europe are beginning to legislate for companies in their countries to establish mandatory due diligence procedures to verify and eliminate deforestation from their supply chains. So far only France has passed a law. Others need to follow suit in order to create an even playing field across corporations and ensure that corporations take responsibility for all of their operations, wherever in the world they are located.
Recommendations for actors in the soy sector
Achieving comprehensive supply chain solutions and deforestation-free soy requires coordinated action, commitments and support from different stakeholders across the supply chain. See what key actors can do to play their part:
- Tighten up legislation around land use to protect important areas under threatened
- Establish policies and incentives that encourage the adoption of more sustainable production practices
- Ensure enforcement of current deforestation legislation
- Increase the transparency and accessibility of national information systems with agricultural supply chain traceability and land-use data
- Protect the rights of local, traditional and indigenous communities.
- Invest in expanding agricultural extension programs and technical assistance, training, and education programs for producers.
- Support the development and deployment of accurate and robust national deforestation and land-use change monitoring systems
- Support efforts to facilitate access to results-based payments for ecosystem services, like REDD+
- Develop public procurement policies that require purchases from sustainable production systems.
- Pass due diligence laws mandating companies to implement plans to prohibit trading in goods linked to environmental or social harm across all their operations, wherever in the world they are located
- Collaborate with actors from the private and third sectors in multi-stakeholder forums in order to enhance understanding of the opportunities for and challenges to reaching zero deforestation soy and create tools to facilitate the implementation of commitments
- Work with other governments to create and endorse high visibility commitments to end commodity-related deforestation
- Develop communication campaigns to educate the public how to avoid deforestation-linked products and "zero deforestation" labels to help consumers change their purchasing choices
- Maintain existing areas of forests and native vegetation by working with cattle ranchers and others in the community to expand into already cleared land
- Work with local NGOs and extension services to improve on-farm practices and enhance productivity
- Use financing options designed to fund the transition to more sustainable production
- Participate in tradeable offset schemes, like the CRA in Brazil
- Participate in multi-stakeholder forums to discuss challenges and opportunities to advance more sustainable practices
- Establish lending and credit criteria that incorporate deforestation and land-use change
- Align lending policies with definitions and cut-off dates of existing initiatives
- Educate account managers on risks associated with financing deforestation and destruction of native vegetation.
- Provide special lines of credit (e.g. lower interest rates, longer payback times, fewer collateral requirements, streamlined processes/quick access) for producers that implement deforestation/conversion-free production practices, adopt sustainable management practices and/or invest in the recovery of degraded areas.
- Support incentives that encourage transparency, traceability, and verification of supply chains.
- Review and assess portfolios for risk associated with deforestation-linked investments.
- Adopt environmental criteria in the financing decision-making process
- Prioritize investments in companies and organizations that are making demonstrated progress towards deforestation-free goals
- Divest from companies that refuse to stop sourcing from newly cleared lands.
- Adopt and implement robust deforestation/conversion-free commitments for all at-risk geographies.
- Deploy effective monitoring, traceability and purchase control systems to ensure soy is not originated from recently cleared lands.
- Conduct regular compliance audits using robust terms of reference and publish the results online, making them readily available in the public domain.
- Develop and implement deforestation/conversion-free commitments and make commitments publicly available
- Participate in pre-competitive platforms to align messaging with peer-companies and magnify demand signal
- Adopt purchase criteria to exclusively source from suppliers that can demonstrate compliance to company deforestation/conversion-free policies, including via suppliers/traders that have the following:
- have made commitments to deforestation-free production,
- use monitoring and tracking systems to ensure fully verified deforestation-free production,
- increase the transparency of their transaction information with supplying farms, and
- publicly disclose their performance through third-party independent audits.
- Tell your favorite brands and retailers that you do not want products that contribute to the destruction of forests and native vegetation.
- Preferentially purchase from retailers that have deforestation-free commitments or show progress towards deforestation-free procurement.
- Use apps and other tools to make more informed purchasing decisions
- Participate in consumer pledges and other calls to action to help magnify your voice and strengthen the demand signal for more sustainable products.
Further Reading
1 Gibbs, H. K., Munger, J., L'Roe, J., Barreto, P., Pereira, R., Christie, M., ... & Walker, N. F. (2016). Did ranchers and slaughterhouses respond to zero‐deforestation agreements in the Brazilian Amazon?. Conservation Letters, 9(1), 32-42.
2 IUCN. (2019). An Analysis of Existing Laws on Forest Protection in the Main Soy Producing Countries in Latin America.
3 IUCN. (2019). An Analysis of Existing Laws on Forest Protection in the Main Soy Producing Countries in Latin America.
4 Sans, G. H. C., Aguiar, S., Vallejos, M., & Paruelo, J. M. (2018). Assessing the effectiveness of a land zoning policy in the Dry Chaco. The Case of Santiago del Estero, Argentina. Land Use Policy, 70, 313-321.
5 Global Canopy, Forest 500. (2019). 2019 Annual Report.
6 Fraanje, W. & Garnett, T. (2020). Soy: food, feed, and land use change.(Foodsource: Building Blocks). Food Climate Research Network, University of Oxford.