Stop cattle laundering, save the Amazon

Zebu cattle in Brazil Zebu cattle in Brazil Frontpage
14 May
2015
A loophole in Brazil’s cattle ranch regulations threatens to undermine recent successes at curbing the beef industry’s impact on deforestation

On paper, it has been a great success. Cattle, and the profitable beef industry, has been a dominant force behind the deforestation of the Amazon in recent years, with at least 60 per cent of cleared land in the rainforest now being used for cattle pastures. Consequently, legally-enforced ‘zero deforestation agreements’ have reduced deforestation on fattening farms selling directly to slaughterhouses, since first being accepted by some of Brazil’s largest meatpacking companies in 2009.

Under pressure from local prosecutor’s office, the Ministério Público Federal MPF-Pará, as well as NGOs such as Greenpeace, the largest of these companies – JBS, Marfrig, and Minerva – all agreed to set up monitoring systems to track their supply chains in the Brazilian state of Pará. This meant only accepting cattle from registered suppliers, who have agreed not to deforest any more of the rainforest. These agreements were replicated across several other Brazilian states, meaning that two-thirds of slaughterhouses in the ‘legal Amazon’ (the states of Acre, Amapá, Amazonas, Pará, Rondônia, Roraima, Mato Grosso, Maranhão, and Tocantins) are now signed up.

amazon 1Major slaughterhouses in the Brazilian Legal Amazon that have and have not signed a zero-deforestation cattle agreement (Image: Gibbs et al)

Despite continued problems of ‘leakage’ – such as unregistered ranches selling cattle to other meatpackers who have no such monitoring systems – measures such as this are a big reason why the rate of annual Amazonian deforestation fell a full 40 per cent between 2004 and 2014. In 2009, 36 per cent of suppliers had land with recent deforestation, but by 2013 this had fallen to only four per cent of suppliers.

These are the findings of a new report, Did Ranchers and Slaughterhouses Respond to Zero-Deforestation Agreements in the Brazilian Amazon?, to which the answer is an emphatic ‘yes’.

‘It’s rare, as a geographer, that you have a eureka moment,’ Holly Gibbs tells Geographical. Gibbs is assistant professor of Environmental Studies and Geography at the Center for Sustainability and the Global Environment, University of Wisconsin-Madison, and lead author of the new report. ‘I’ve worked on deforestation for over fifteen years, and I’ve never seen a policy elicit changes so quickly. In this case, we’re very clear that there have been dramatic changes in a period of months,’ she explains.

Gibbs’ team surveyed suppliers in the cattle-dominated state of Pará, which has seen 40 per cent of Amazonian deforestation over the past decade. Their principle conclusion was how widely successful the zero deforestation agreement has been, with a huge spike in supplier registrations in late 2009/early 2010. By the end of 2013, for example, over 95 per cent of suppliers to JBS slaughterhouses were registered, significantly up from none just five years earlier.

amazon 2JBS slaughterhouse transactions with registered suppliers increased dramatically following the zero deforestation agreements (Image: Gibbs et al)

However, the report also discovered a noteworthy amount of cattle ‘laundering’. The current zero deforestation agreements only apply to ranches selling directly to slaughterhouses, which leaves the door open for cattle for be reared on illegally deforested land before being moved to legal, registered ranches prior to their sale. ‘For example, if I am a rancher,’ explains Gibbs, ‘I’ve been clearing my forest, fattening my cows on that land, getting them ready to sell to JBS. Then all I need to do is walk my cows down the street to another property that I own, or a neighbour’s or family member’s property, to sell to the slaughterhouse. So I take my cows from that ‘dirty’ property, over to a ‘clean’ property that’s compliant with the rules.’

This transfer of cattle from ranch-to-ranch is common across Brazil, and most farmers are quite open about using it as a business practice. ‘The cows are not embargoed, only the land’ was a comment heard frequently by the surveyors. And it isn’t technically against the rules. ‘They're following the letter of the agreement, but not the intent,’ as Gibbs describes it.

It is very hard to know exactly how much this laundering is going on, and how much official ‘zero deforestation’ beef started out life as cattle on illegally deforested land. Gibbs notes that in the study area of Pará, there were 3,600 registered suppliers to JBS, at least a third of which had additional land elsewhere (and possibly more, just not on the property database).

amazon 3Laundering and leakage in the beef supply chain (Image: Gibbs et al)

From the point of Paulo Barreto, senior researcher at IMAZON, and co-author of the report, the most important pressure has to come from the major slaughterhouses, if they really want to stop deforestation. ‘The Brazilian government has not been able to build a traceability system and is unlikely to develop it in the near future given that Kátia Abreu, the current minister of agriculture was, until recently, the head of the farmer’s federation,’ he tells Geographical. ‘Analysts have pointed out that some ranchers fear transparency given that cattle ranching is used for money laundering and tax evasion. But if the big buyers say firmly “I want to know from where all the cattle comes from”, the politicians would have to deliver transparency.’

In the distant future, an alternative way to get around these laundering problems could be a system capable of tracking individual animals. However, Gibbs dismisses this as too ‘far off’ and ‘expensive’ to be implementable on a significantly large scale anytime soon.

However, she does draw attention to an existing database, the Guia de Trânsporte Animal (GTA), or Guide to Animal Transport, which tracks the transfers of animals between farms for medical reasons. ‘Every time cows are moved from one farm to another, they have to get this GTA document for that movement,’ she explains. ‘That could be used to develop a system to monitor the flow of cattle in the supply chain. But right now, that database is not publicly available, not even to the meatpacking companies.’ She hopes that over time, this could be the start of a new mechanism to open up these supply chains to more public scrutiny.

The existing zero deforestation agreements have undoubtedly been a huge step forward in protecting the Amazon. However, these findings suggest that, instead of being a silver bullet, they may be the first steps of a process which still has a long way to go.

Did Ranchers and Slaughterhouses Respond to Zero-Deforestation Agreements in the Brazilian Amazon? was published in Conservation Letters

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