Bucking the trend: South American soy and beef soar in times of Covid-19
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Bucking the trend:
South American soy
and beef soar in
times of Covid-19
Photo: Alamy
2Photo:Bucking
Alamy the trend: South American soy and beef soar in times of coronavirus
Contents
Fires threaten the Amazon once again. What have we learned? | 4
Rising beef demand linked to Amazon deforestation | 6
Chinese outrage at WWF video linking beef demand to deforestation | 10
Investigation implicates JBS in ‘cattle laundering’ | 14
Coronavirus disrupts global meat supply chain | 16
The murky process of licensing the Amazon’s meatpackers | 19
China seeks greater quality and quantity to ease food security worries | 24
Covid-19 spike hits at peak soy export season | 27
Argentina’s farmers go ‘carbon neutral’ to retain agriculture markets | 29
Questions persist over giant Chinese soy trader’s track and trace plan | 32
1
Foreword from the editor:
W
ith over 10 million confirmed Despite these unprecedented times,
cases and Latin American South America’s soy and beef exports to
countries numbering five of the China have prospered remarkably. Efforts
world’s ten worst-hit by COVID-19, the towards a resolution of US-China trade
pandemic has taken a devastating toll on tensions have faltered and populations of
the region’s populations and economies. Chinese pigs - top consumers of South
American soy - have begun to recover
Lockdowns and the lower availability of following an outbreak of African Swine
certain goods and services have meant Fever, countering some of the negative
that regional GDP is expected to contract effects of coronavirus. At the same time,
by 8.1% in 2020. According to the IMF, the malaise of soy- and beef-driven
Latin America is not expected to return to deforestation and forest degradation has
precoronavirus growth levels until 2023. continued.
Somewhat surprisingly, Brazil, which Fires in Brazil’s Amazon were up
accounts for almost half of all Covid-19 13% in the first nine months of 2020.
cases in the region, is projected to suffer August and September fires were more
less than its regional counterparts, at numerous even than during the same
least in terms of crude macroeconomic months of 2019, when the upsurge
indicators (-5.1%). attracted international condemnation.
Even Argentina’s Paraná Delta has been
One reason for Brazil’s resilience is that its set ablaze to a degree not witnessed in
economy has been buoyed by record sales living memory, as forests were felled for
of soy and beef to China. In June, Brazil’s unplanned industrial development.
soy exports to China were 91% above levels
of June 2019, topping 10 million tonnes for With commodity-related forest loss
the first time. Beef, too, is moving between continuing apace, Diálogo Chino
the two countries in record volumes. Sales presents a special series of articles that
in the first half of 2020 were up 50% on the examine South American soy and beef
corresponding period last year. supply chains amid the backdrop of
coronavirus, to demystify and illuminate
And it’s not just Brazil. This year, Argentina’s the lesserknown aspects of a surprisingly
beef exports to China are set to match the resilient, and often murky, trade.
800,000 tonnes it sent last year, regardless
of the challenges of the pandemic. The articles in the series identify new
2 Bucking the trend: South American soy and beef soar in times of coronavirus
deforestation hotspots in the Brazilian Amazon and
locate meat plants licensed to export to China; They
explore importers’ exposure to deforestation risk;
explain the process of sanctioning new plants for
export; and interrogate the sustainability of both
Brazilian producers’ and Chinese buyers’ suppliers.
Equally importantly, the series looks at policy
developments in China, as the country tries
to improve self-sufficiency in grain output.
Understanding Chinese consumer preferences
is key to achieving greater sustainability. We
also look at Argentina’s efforts to neutralise the
carbon embedded in agricultural exports, and
report on misguided finger pointing at Chinese
beef eaters that implied they were responsible for
the destruction of the world’s largest continuous
rainforest.
With Chinese demand for soy and beef expected
to remain high, agriculture in Brazil and Argentina
will continue to play an important role in
their respective national economic recoveries
postcoronavirus. But closer scrutiny of the actors
and institutions that set the parameters of the
trade is vital if it is to transform itself into a net
contributor to the good health of South America’s
economies and ecosystems. We hope the articles in
this series offer this essential scrutiny.
Isabel Hilton
founder and editor, Diálogo Chino
3
Ibama firefighters tackle blazes in Apui, Brazil’s Amazonas state, in August
Photo: Alamy
Manuela Andreoni
Fires threaten the Amazon once
again. What have we learned?
Data suggests an Amazon fire season is struggling to change the
worse than 2019’s that shocked the narrative around the crisis.
And this year’s fire season
world. So what are international has intensified the focus on
investors doing about it? its environmental problems.
So what, if anything, has
This year’s Amazon fire season Bolsonaro’s administration has changed?
is already breaking records. resisted fighting. Bolsonaro
In July, there were 27% more refused to strengthen the WHAT’S DIFFERENT ABOUT
fires in Brazil’s portion of the country’s environmental THE AMAZON FIRE SEASON
world’s largest rainforest than protection agencies as THIS YEAR?
last year, when images of trees increasingly large parts of
ablaze shocked the world. And the forest were converted to In short, there is more dead
the numbers are still rising. pasture and illegal mining sites. wood available to feed the
flames.
The fires became an The fire season comes
unwelcome hallmark of the as Brazil’s soy and beef When political and business
administration of Jair Bolsonaro, exports are booming, raising leaders across the globe
Brazil’s far-right president, after concerns among foreign expressed outrage last year
he took office in 2019. Though investors and business at Brazil’s inability to stop
Brazil has invested millions in leaders that they’re profiting the Amazon burning, former
fighting fires in the Amazon from the Amazon’s demise. army captain Bolsonaro sent
since last year, the root of the in the military.
problem remains intact. “This story that the Amazon
is burning is a lie,” said Data suggests that helped
Amazon fires typically follow President Bolsonaro in a curb fires in the ensuing
deforestation, a problem recent meeting. But Brazil months, but deforestation
4 Bucking the trend: South American soy and beef soar in times of coronavirus
kept rising and the military Chinese officials have so
2023
didn’t hold the perpetrators far avoided taking a stand
accountable. That means against surging deforestation
that this year, farmers and in Brazil. During last year’s
land grabbers were free to fire season, the number
burn what they meant to the year by which two ranking diplomat at the
last year, plus all the trees Cofco, China’s Chinese embassy in Brazil
they’ve cut down since. largest grain trader, praised local environmental
pledges to have a laws. And at a press
Research from the Amazon fully transparent conference earlier this year,
Environmental Research Chinese diplomats ignored
soy supply chain
Institute (Ipam) calculates journalists’ attempts to elicit
that roughly 9,000 square comments on deforestation
kilometres of destroyed in the Amazon.
forest have been left to
burn as of August this year. the company was unable to Suely Araújo, who was
If 60% goes up in flames, monitor its own supply chain head of Brazil’s main
this year’s season will be as for connections to illegal environmental protection
bad as last year’s. If all of activity. China’s Cofco, one of agency, Ibama, until last
it burns, however, it could the biggest trading companies year, said international
lead to “an unprecedented in Brazil, promised to make its pressure in the late 1990s
health calamity” in the region soy supply chain fully traceable was behind the country’s
by adding to the effects of by 2023. most important law against
Covid-19, Ipam wrote. environmental crimes.
Still, there has been little
DID THE WORLD’S sign that investors have “If there is one way this
OUTRAGE LAST YEAR MAKE taken significant amounts of government will improve
A DIFFERENCE? money out of Brazil because its policies in this area, it
of environmental issues, is through international
Yes, but there have been no and exports of agricultural pressure,” she said.
significant changes in policy products are booming,
or in farmers’ profit margins. even as their links to illegal WHAT HAS THE
deforestation become GOVERNMENT DONE
Investors from Brazil and apparent. DIFFERENTLY SINCE LAST
abroad reacted strongly to YEAR?
the government’s inability While the Chinese press has
to control deforestation acknowledged the increase in The government’s move to
and fires. Links between deforestation in the Amazon put the military in charge
environmental destruction in recent months, Chinese of protecting the Amazon
and the supply chains of investors and business has been critisied by
major agribusiness players leaders haven’t mirrored US environmentalists as a lot
have also been spotlighted. and European firms’ threats more expensive and a lot less
to divest their Brazilian effective than empowering
The government made setting assets if the issue isn’t environmental agencies.
fires in the Amazon illegal after effectively addressed.
a group of global investors The government spends
said it was concerned about Action from China could have roughly 60 million BRL
the country’s environmental major positive consequences, (US$11 million) per month
record. Yet inaction led Nordea researchers say, as the on its Amazon military task
Asset Management, the Brazilian meat industry’s force, only a little less than
investment arm of Europe’s dependence on Chinese Ibama’s annual budget for
largest financial services group, buyers continues to grow. law enforcement.
to drop JBS, the world’s largest Many farmers believe that if
meat packer in July. HSBC also European firms boycott them, Throwing money at the
warned investors about the they can simply offset their problem hasn’t worked
risk of investing in JBS, arguing losses by turning to China. so far. Deforestation has
5
kept rising and fewer
environmental crimes have
been reported, as funding to
the environmental agencies
has been slashed. The
Brazilian government has
also repeatedly punished
Ibama agents for doing
their jobs – once firing the
head of law enforcement
after a massive, successful
operation against illegal
mining.
“Militarising deforestation-
Activists protest against the Amazon fires
control is not efficient,” outside the Brazilian Embassy in London.
Araújo said. “They don’t have Photo: Alamy
the expertise.”
Gustavo Faleiros
Rising beef demand linked to
Amazon deforestation
Brazilian beef exports are causing around 70,000 hectares of
deforestation each year
Porto Velho is one of the
biggest cities in the Brazilian
Amazon but it still feels like
a small town. Located in the
heart of Rondônia state, trade
is modest and the population
is growing relatively slowly,
increasing from 428,000 to
530,000 in a decade.
The cattle population,
however, is growing much
more quickly. A decade
ago, the human and bovine
populations in the Porto
Velho municipality were
similar. Today, there are twice
as many cattle as humans.
This same trend is repeated
in the other states that
6 Bucking the trend: South American soy and beef soar in times of coronavirus
encompass the Amazon
biome. Data from the
Brazilian Institute of
Geography and Statistics
(IBGE) show that cattle herds
in the north of the country
have grown more than any
other Brazilian region. Here,
herds grew 22%, compared
to the national average
of 4%, as shown in a new
cattle-ranching map of Brazil,
produced by InfoAmazonia
and Diálogo Chino.
Beef production and Amazon
deforestation are linked
This growth is driven by Photo: Fábio Nascimento
demand. With more money
in their pockets, families
worldwide, and especially Numbers of cows in Porto Velho (2004-2018)
those in developing 1,100,000
countries, are consuming
more meat. 1,000,000
China, the final destination 900,000
of more than a third of
800,000
meat produced in Porto
Velho, is a case in point. 700,000
Chinese consumers eat 30%
more meat compared to 600,000
a decade ago. Though the
500,000
average person in China still
consumes almost ten times 400,000
less meat than the average
Brazilian, the size of the 300,000
country’s population means
200,000
consumption habits have a
tremendous impact. 100,000
Higher levels of beef 0
consumption worldwide 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
have brought prosperity to Source: The Brazilian Institute of Geography and Statistics (IBGE)
Rondônia’s farmers. Adélio
Barofaldi is CEO of Grupo Barofaldi told Diálogo Chino and the conversion of more
Rovema, which owns the at his Porto Velho office. tropical forest.
largest network of car
and truck dealers in the But the market has also The irregular process of
state, and invests in energy become a powerful driver land occupation affects
and livestock. He is also of deforestation. Rondônia conservation units
president of the Association was among the states most (areas), even in the state
of Rural Landowners of affected by this year’s fires. of Amazonas, which
Rondônia (APPRO). As local ranchers become neighbours Rondônia. In the
more successful, the value southern region, mainly the
“We are the fifth-largest of pasture in the region district of Santo Antônio do
producer of beef from Brazil, also increases, which has Matupi and the municipality
with 70% of land preserved the common consequence of Apuí, the agricultural
and not deforested,” of encouraging land fraud frontier is advancing
7
alongside land fraud 65,000 to 75,000 hectares of more than half of which are
schemes, wood theft and deforestation. in the Amazon region.
forest clearance for pasture
by unlawful fires. Of this, 22,700 hectares “China is the largest market.
were attributed to exports They are definitely exposed
Researchers and to China, with some 18,000 [to the risk of deforestation],”
environmentalists are calling of those hectares linked said Erasmus zur Ermgassen,
this process “Rondonization”. to Hong Kong, the number a researcher at Trase and
one destination of meat the University of Louvain in
According to IBGE’s most produced in Brazil. Belgium.
recent Municipal Livestock
Survey (PPM), Porto Velho’s The report explains that Ermgassen said that the
herd has grown 145% in just most deforestation (52%) research team reviewed
15 years. By 2018, there were occurs in the Amazon, import contracts from 2015
1.04 million head of cattle, meaning Hong Kong’s to 2017 to identify which
compared to 426,400 in imports are more exposed processing plants exports
2004. Today, the Porto Velho to “deforestation risk”. Since came from and to calculate
municipality has the third- mainland China gets most the deforestation risk. They
largest herd in the Brazilian of its meat imports from checked this information
Amazon, and the fifth largest meatpacking companies in against deforestation data
in Brazil. the Cerrado biome, a vast at the municipal level, taking
tropical savannah, they carry into account conversion
Porto Velho was indicated a smaller deforestation to pasture and each
as having the highest risk footprint. meatpacking plant’s radius
of deforestation in Brazil’s of activity.
entire beef export chain. Since 2015, when Chinese
health authorities approved Ermgassen hopes that the
SUPPLY CHAIN imports of Brazilian beef private sector will adopt
TRANSPARENCY after a years-long ban, the Trase indicator, since
business has skyrocketed. it translates pressure on
The Trase initiative, a group Imports from Hong Kong forests into actual numbers.
of researchers studying the and mainland China account
impacts of the commodities for a combined 38.2% of “With this analysis, we are
trade, indicated in its latest Brazil sales of packed meat. showing that it is possible
report that Brazil’s annual Recently, Chinese authorities to know how much
beef exports, estimated at approved supplies of meat deforestation exists within
1.4 million tonnes, generate from 17 new packing plants, each exported cargo,” he said.
Even with the high
correlation between meat
exports and deforestation,
Chinese companies do not
seem to be paying attention.
At the beginning of the year,
Trase had already identified
Chinese companies with
major potential to influence
the Brazilian market. But a
search on these companies’
websites did not find any
mentions of sustainability. A
few reported concerns over
health issues and pollution,
A cattle feedlot in the Amazonian state of Rondônia
but all seemed inattentive to
Photo: Fábio Nascimento
the threats faced by forests.
8 Bucking the trend: South American soy and beef soar in times of coronavirusMONITORING TOOLS to the slaughterhouse and
finally the meatpacking plant.
A decade ago, Brazil’s federal Yet there are many cases
public prosecutors found of “triangulation” to legalise
links between the meat herds that at some point
industry and land fraud, fires lived on pastures that had
and deforestation. been illegally deforested.
Launched in 2009, the Paulo Barreto, a researcher
Legal Meat programme at Imazon who has studied
established deferred ranching in the Amazon
prosecution agreements for decades, noted that it
(TAC in Portuguese) to give benefits neither producers
meatpacking plants time to nor the government to
get their houses in order and establish a system that
meet tracking requirements permits total traceability
along the beef production since there is an economic
chain. advantage in keeping part of
the herds invisible. Adélio Barofaldi says people need to “tell
That same year, Greenpeace the truth” about beef and deforestation
was able to get the country’s He added that the complex
four largest beef producers interaction of different
to agree to support zero actors within the system 500-hectare area on his farm
deforestation in the means it’s unlikely there is a that he will not clear. If he were
production chain. direct connection between to do so now, he would run the
growing Chinese demand risk of being called a criminal.
Then in 2017, the Chinese for beef and increased
Meat Association, which deforestation, Barreto said. Barofaldi does, however,
represents 40 importers, admit that livestock ranching
signed an agreement. “In this system full of holes, needs to become more
any additional demand efficient, with better pasture
Though positive, such generates risk.” management and intensified
initiatives remain insufficient. production.
Even with agreements RANCHERS FIGHT CRITICS
covering 80% of meat In the Amazon, herd
exports, the challenge of total Rancher Adélio Barofaldi concentration is still low
traceability is still a huge one. insists on the need to “tell at only one animal per
the truth about the Amazon,” hectare. This number must
Researchers who work which he says differs from be improved, he says, and
on the topic, such as the alarming headlines explains that the goal is
Imazon and Greenpeace, about fires that appeared in seven to eight head per
recently indicated that newspapers worldwide. hectare.
transparency is decreasing.
They experience difficulties He says that criminalising In Rondônia, the trend
accessing information on deforestation is a mistake, is toward using more
livestock transport routes since Brazilian legislation technology, such as electric
on the federal government’s allows clearing on 20% fencing, and recovering
website, as well as updates of rural properties in the degraded pasture, to produce
on companies’ own websites. Amazon region. cattle and grains for export.
“It would be possible to
The main problem is that the “(Satellite) photography double the size of the herd in
herds are extremely mobile. does not show whether Rondônia without additional
This is partly the nature of deforestation is legal or deforestation,” he says.
the business. Cattle are born illegal,” he says.
on one farm and fattened This article was originally
on another. They then go Barofaldi says that he has a published by Diálogo Chino
9Wang Chen
Chinese outrage at WWF video linking
beef demand to deforestation
Why did a film designed to promote sustainability
certification receive such a backlash online?
Cattle on land cleared for pasture in the Amazon
Photo: Alamy
On 21 March, World Forest Day, with deforestation sparked titled How to Quickly Destroy
a short video on conserving accusations that it was the World’s Forests. It was
global forests sparked angry “insulting China.” first challenged on Bilibili.
protests on the Chinese com, a video streaming site
internet, and was taken down This is not the first time popular with young Chinese
by its makers the next day. advocacy of environmentally people, where Paperclip is
friendly consumption has well-known as a producer
The five-minute film was received a backlash in China. of science and technology
a joint effort by PaperClip, With Chinese markets having content. A video Paperclip
a group which produces an increasing impact on the published on 2 February,
educational films, and global environment, efforts to “Everything You Need to
the WWF. It showed how guide sustainable consumption Know About the Coronavirus”,
farming for livestock and soy must navigate the fraught provided detailed and
is destroying forests in the terrain of online opinion, accurate information on the
Amazon region, in an attempt rubbing up against nationalism epidemic and was watched
to encourage consumers to and the “right to development.” over 100 million times. A mere
choose products certified seven weeks later, Paperclip
sustainable. But linking the ‘INSULTING CHINA’? was being attacked on the
purchase of meat, eggs and platform, for a video about
milk by Chinese shoppers The video was provocatively protecting forests.
10 Bucking the trend: South American soy and beef soar in times of coronavirusThe film starts by describing
how human activity has
damaged forests over the
last two decades. Citing
the WWF’s 2015 “Living
Forests Report,” it links
production of beef and
soy to the destruction of
the Amazon rainforest. It
describes this global chain
linking production and
consumption as “the most
efficient forest-elimination
machine” and points out
the role of Chinese markets.
According to the voiceover: https://youtu.be/_uti4RZPHeE
“Brazil can’t cut soybean
Scan the
farming, because it needs QR code to watch
on your phone
to sell to the world’s biggest This isn’t the first online
buyer, China.” The film also controversy over calls for lower
discusses other commodities meat consumption in China.
associated with deforestation: The anger did not stop there.
“The production, trade and Some called Paperclip’s politics In March 2019, international
consumption of palm oil, into question, after ploughing organisation WildAid launched
rubber, timber and paper through its old videos and its Less Meat Is My New Dish
impacts on forests in places finding some in which Taiwan campaign in China, calling
including Sumatra and island was not clearly visible for lower meat consumption
Kalimantan.” Finally, the video on what were supposed to to reduce greenhouse gas
suggests opting for products be maps of China. Others emissions. Chinese film stars
with sustainability certification pointed out that sustainability featured in the campaign,
to avoid becoming certifications charge fees, so online and on posters in
inadvertently involved in “It’s all commercial.” subways and airports.
deforestation.
Paperclip then removed the The adverts were soon
Within 24 hours, the video had video and made a statement: challenged by internet
sparked a huge backlash that the video had not blamed opinion leaders. In a now-
spread to other social media China and the uses of “we” deleted Weibo post, popular
platforms such as Weibo. referred not to Chinese people, science blogger Scientific
but to humanity as a whole. Future Man asked: “Why are
The attacks focused on Americans, beef-eaters with
whether it was fair to link Before being taken down, it higher per-capita carbon
consumption of meat, was copied and published on emissions, always banging
milk and eggs in China YouTube. on about how Chinese
with destruction of the people should eat less
Amazon rainforest. “We’ve WHO CHANGES FIRST? pork?” before pointing out
only had meat to eat for a that WildAid is an American
few years, and it’s us that Jian Yi, founder of non-profit organisation and saying
have harmed the planet?” the Good Food Academy and such advocacy has “other
asked one poster. Many director of the documentary motivations.” Guancha.
contrasted per capita meat What’s for Dinner, told China cn soon joined in, with an
consumption in China and Dialogue that environmental article asking: “What was this
the US, where people eat advocacy needs to avoid foreign organisation thinking
twice as much, and mainly “ascribing responsibility to in asking Chinese people to
beef which has a far larger any particular group” as this eat less meat to protect the
carbon footprint than the “will always make someone Earth?” and describing the
pork favoured in China. uncomfortable.” adverts as “repulsive.”
11Businesses using health and
the environment as selling
points have also wandered
into the minefield. On 8
January this year, in an article
on the prospects for meat
alternatives in China the New
York Times quoted Pat Brown,
CEO of plant-based “meat”
manufacturer Impossible
Foods: “Every time someone
in China eats a piece of meat,
a little puff of smoke goes up
in the Amazon.” Nationalist
media outlets Global Times
and Guancha.cn complained
America’s environmental
responsibilities were
being shifted onto China’s
shoulders.
Fang Kecheng, assistant
professor at the Chinese
University of Hong Kong’s
School of Journalism and
Communication, expects this
atmosphere to continue. In
the past, Chinese nationalism
was based around websites
and forums, with limited
reach and regular participants.
But now a focus on building
traffic has changed this.
“There’s profit to be made differences within the beef sales fell by 4% and
by playing up conspiracy country. In 2016, the State pork by 6.4%, while meat-
theories,” Fang said, adding Council’s Development free alternatives rose 18%,
that large numbers of Research Centre predicted the highest growth of any
accounts are chasing the that meat consumption by category.
nationalist topics that China’s city-dwellers will peak
resonate with the public. as soon as 2022, at 85 kg Health issues such as
per year. Meanwhile, in rural high blood pressure and
RELIANCE ON OVERSEAS China a peak is not expected obesity, linked with meat
AGRIBUSINESS to arrive until 2030. So while consumption, are also
some Chinese people may drawing attention in China.
Since 1961, per capita meat be eating as much meat as The China Nutrition Society’s
consumption in China has Europeans, others are still 2016 nutritional guidelines
increased by a factor of 17. getting less than they want. recommended eating 14.6-
Yet while the average Chinese 27.4 kg of meat every year
person ate 61 kg of meat in Interestingly, while China’s – less than half the current
2017, the average European overall meat consumption national average.
consumed 83 kg and the is increasing, in the US and
average American 124 kg, Europe it is levelling off or Meat production stresses
according to UN figures. falling in response to health, water and soil resources,
environmental and climate worsens climate change
That Chinese average concerns. For example, in and makes humanity more
hides urban/rural and class UK supermarkets last year vulnerable to it. In 2019, a
12 Bucking the trend: South American soy and beef soar in times of coronavirusmajor report from the UN’s BECOMING A GREEN 2030, and helped create the
Intergovernmental Panel on RULE-MAKER Paris Agreement. Li wrote:
Climate Change suggested “Debate over emissions rights
global cuts in meat eating. During the debate sparked and development rights in the
by the video, one old topic media gradually faded away,
In 2017, China consumed again stirred up nationalist and once noisy conspiracy
over 89 million tonnes of sentiment – the rights of theorists fell silent. Questions
meat, more than a quarter latecomer countries to over the scientific reality
of the global total. China develop. But on issues like of climate change virtually
produces the vast majority climate change, China has vanished from Chinese media.”
of that but relies on imports actually moved beyond such
for most of its livestock sentiments. The authors of the
feed – including 90% of Tsinghua-Brookings Centre
its soy meal, the most Eleven years ago, the Chinese report wrote: “If China’s
important feed. China’s government received strong emissions peak target is
2017 soy imports accounted public praise for its defence to be achieved as soon as
for over a quarter of global of development rights at possible, a transformation
consumption. Agricultural the Copenhagen climate of our current consumer
economists have said that change talks, regarding the culture is needed,” before
China’s arable land cannot allocation of responsibility explaining that “transforming
currently produce the soy for carbon reductions. At the consumption” did not mean
meal needed for the country’s time, conspiracy theories sacrificing the economy for
livestock industry, and so that climate change was the sake of the environment,
in effect it “imports” arable not manmade and that but rather achieving more
land in this way. China is the west was using it to stable economic growth and
self-sufficient in staples, but restrain China’s growth were transforming the industrial
heavily reliant on overseas common. When Chai Jing, structure, while improving
agribusiness for the fodder hosting CCTV’s Face-to-Face health and happiness.
needed to meet demand for interview show, asked Ding
meat, eggs and milk. Zhongli, a scientific adviser Some greener consumption
to the Chinese delegation in trends have already appeared.
In a 2016 report on low- Copenhagen, about fairness The popularity of shared
carbon development in emissions reductions, he bikes has changed how urban
in China, the Tsinghua- even replied with: “Aren’t the residents travel; restrictions
Brookings Centre suggested Chinese also human beings?” on car registrations has led
that US-style carbon- to more people choosing
intensive consumption China has since shifted new energy vehicles. Will
should not be an aim for from protecting its right to “transforming consumption”
Chinese society, and that develop and a passive role in mean Chinese consumers use
China’s building of an international climate politics their buying power to help
ecological society means to active participation in the protect global goods such as
it must remake energy global climate programme. the Amazon rainforest?
and consumption systems According to environment
to find a more moderate, journalist Li Jing, since 2011 May Mei, executive director
higher quality mode of various domestic policy of advocacy group GoalBlue
consumption. priorities – ensuring energy Low Carbon Development &
security, tackling air pollution Promotion Centre, thinks this
China’s heavy reliance on and responding to changes in is the right approach. She told
imports for primary goods international energy markets – China Dialogue: “Consumers
gives it great influence over have aligned with a more active should know how China’s
supply chains. That influence stance on climate change. strong markets and spending
could produce far-reaching The country’s 12th Five Year power can influence global
positive effects, for example Plan (2011-2015) sent positive supply chains and how they
by ensuring food on Chinese signals. Then, in 2014, China can play a role in making
tables is not linked to publicly committed to peaking those supply chains more
deforestation overseas. greenhouse gas emissions by sustainable.”
13A new investigation has linked JBS, the world’s largest meat-packer to a process known as cattle laundering
Photo: Alamy
Manuela Andreoni
Investigation implicates JBS
in ‘cattle laundering’
New report reveals world’s biggest meat packer
transported cattle linked to illegal deforestation to its
Hong Kong-approved slaughterhouses
For years, JBS, the world’s years, might be directly deforestation, especially in
largest meatpacking company, implicated. The report found the Amazon. Under Brazil’s
has claimed it is unable to photographic evidence from far-right president Jair
monitor indirect suppliers July 2019 that a JBS truck Bolsonaro, deforestation has
and ranchers accused of hauled cattle from a farm skyrocketed, and researchers
illegal activities. The claims embargoed from grazing cattle expect this year’s fire season
have allowed the company because of illegal Amazon to break records.
to dodge responsibility for deforestation to a clean farm
‘cattle laundering’, the well- with the same owner, an In a statement, JBS said
known practice of moving approved JBS supplier. the report “does not reflect
cows from ‘dirty’ farms linked its operating standards.”
to illegal deforestation to The embargo, imposed by The company also told
reputable ones, before then Brazil’s main environmental TBIJ it had investigated the
sending to abattoirs, creating protection agency Ibama, is evidence and found that
the appearance of a ‘clean’ both a punishment and a the collection farm was
supply chain. protective measure to allow not shown to be within any
deforested land to recover. embargoed area, according
But a new investigation by to its own system. JBS said
Repórter Brasil, The Bureau of The findings come as it introduced a new system
Investigative Journalism (TBIJ) the Brazilian government on 1 July that it expected to
and The Guardian has found and agribusiness are make “a significant impact”
evidence that the company, under increasing pressure in the reduction of cattle
whose sales to Europe and from international and laundering. “We are working
Asia have boomed in recent local investors to fight towards a completely
14 Bucking the trend: South American soy and beef soar in times of coronavirustransparent supply chain,”
the company said.
The investigation uncovered
$420,000
a July 2019 Facebook post
by a driver’ picturing him the fine the Estrela do Apurinã farm received in 2012
in a JBS uniform alongside for illegal deforestation (US$)
images of at least four four
or five trucks in transit from
one farm to another. In the supplier to China, as growing the Amazon meet socio-
post, the driver says his incomes changed traditional environmental criteria.
team is transporting cattle diets and, more recently, the
from the Estrela do Apurinã swine fever outbreak pushed But the auditor always said the
farm, which was fined over local suppliers to source company has failed to track its
2,200,000 BRL (US$420,000) other forms of animal protein indirect suppliers. In messages
in 2012 for illegal from foreign markets. exchanged with Amnesty
deforestation, to Estrela do International following a
Sangue, which supplies JBS. Brazil’s beef exports to recent investigation, DNV
China grew 53% in 2019 and representatives stressed that
According to Repórter Brasil, continued to grow in 2020. its audit does not represent
39% of the Estrela do Apurinā The result was that, even as evidence of good practices in
farm is under embargo, leaving deforestation rates soared JBS’s supply chain.
61% that could rear cattle last year, JBS’s market value
legally. Documents show shot up. More recently, the JBS has been implicated in
7,000 cattle were transported Covid-19 pandemic has using suppliers connected
between the Estrela do curbed gains. to illegal practices in the
Apurinā and Estrela do Sangue past. In April 2017, Ibama,
farms between June 2018 and Researchers have long Brazil’s main environmental
August 2019, the report says. suspected that JBS had a protection agency,
role in cattle laundering. embargoed several of JBS’s
The image was cross- Paulo Barreto, a senior plants and one exporter, as
checked against official cattle researcher at Imazon, an it faced allegations it bought
transport records showing Amazon-based think tank 20,000 cattle from farms that
that Estrela do Sangue that tracks deforestation, had been punished for illegal
transferred roughly 3,000 said that the evidence in the deforestation. But favourable
cows to two JBS processing report takes the connection court decisions meant JBS
plants in the state of Mato to a new level. has yet to pay any fines.
Grosso between November
2018 and November 2019. He said the findings merit Barreto said no previous
an investigation by Brazilian investigations or threats from
The two plants — in the authorities and investors investors have yet resulted
cities of Juína and Juara — demanding better practices in significant punishments
are approved to export beef from agribusiness companies. against JBS. But he says
to Hong Kong. Chinese buyers are in a
“I don’t have expectations privileged position to force the
According to data released the company will make any company to make changes
by supply chain monitoring great changes unless there since farmers often dismiss
initiative Trase, almost 4,000 are concrete implications,” investigations and complaints
tonnes of beef from JBS he said. by international NGO’s and
logistics hubs in those two investors from Europe.
cities ended up in Hong Kong JBS has previously said it
in 2017, almost 2% of sales to uses an audit conducted “They normally say: ‘we will
that destination that year. independently by DNV GL, just sell to China instead,’” he
a Norway-based auditing said. “If China signaled that
In recent months, JBS company, that concluded it cared about this, it would
has become a major beef all its direct suppliers in make a difference.”
15He Mu, Lucia Wei He
Coronavirus pandemic disrupts
global meat supply
Covid-19 has raised food prices and the spectre of shortages,
but so far there are no signs of a drop in cattle farming
across Latin America
A group of young steers in the meadow in Argentina
Photo: Alamy
In recent weeks, over 20 In Latin America, where to a decline in demand as a
meat-processing facilities coronavirus cases are result of the epidemic.
in the US have faced accelerating at a faster rate
temporary shutdowns as than other regions, a similar Meanwhile in Uruguay, 22
a result of coronavirus dynamic is beginning to take out of the country’s 51
outbreaks among workers. hold in the meat sector. meat-processing facilities
were either inactive or
An estimated 6,500 workers Brazil’s southernmost state partially active as of early
have been infected, and lower of Rio Grande do Sul has April, with overall production
processing capacity has led reported outbreaks in nine down 50%.
producers and farmers to cull meat processing facilities, with
millions of animals. 124 confirmed cases between The widespread disruption
March 20 and April 27. in Uruguay was partially
The closures have also led driven by a strike led by
to a spike in the wholesale Earlier in March, ten other the Meat Industry Worker
price of beef and pork, while Brazilian meatpacking Federation (Foica). The
raising the spectre of a plants temporarily union’s Cerro branch, which
potential shortage of food. suspended operations due represents approximately
16 Bucking the trend: South American soy and beef soar in times of coronavirusMIXED SIGNALS FROM coronavirus has temporarily
50%
CHINA disrupted meat consumption
and trade patterns.
Even prior to coronavirus,
global meat supplies were Although specific figures
The drop in meat down due to an outbreak are not available, Rabobank
production in Uruguay of African Swine Fever, estimates that Chinese
which lowered China’s pork consumption of beef, poultry
production to a 16-year low. and pork all declined during
the first quarter of 2020,
50% of the country’s meat The shortage of pork led to driven by the closure of
workers, cited health a surge in meat imports in restaurants and fresh markets.
concerns as a reason for 2019, with beef increasing
calling the strike. 60% to 2.1 million tons, and Imports of beef are also
pork 75% to 1.66 million expected to be lower during
Martin Cardozo, President tons, compared to 2018. the first half of 2020, due to
of Foica Cerro said in a a large quantity purchased
radio interview that “it’s Partially driven by trade ahead of the Lunar New
a strong measure [...] restrictions with the US, Year, and subsequently not
because it weighs on Latin America was one of consumed.
businesses, workers and the biggest beneficiaries
union leaders alike. We of China’s higher imports, Nevertheless, the impact of
are acting out of solidarity with major producers in Chinese market dislocations
with the population and the region all seeing strong on Latin America has so far
the government. We are growth in sales. been mixed.
convinced it’s for the
better.” In 2019, Brazil’s beef exports Argentina saw a reduction in
reached a record 1.83 million shipments of 35% in January
In Argentina, a meat plant tons, up from the previous compared to December,
in Buenos Aires province record of 1.64 million tons with a further 30% decline
closed following the death set in 2018. The jump was in February. Sales in March
of a food safety inspector. largely driven by increased were only 15% of those
Five additional employees sales to China, which were registered in late 2019.
also tested positive for up 39.5% compared to 2018.
coronavirus, and previously In an interview with Reuters,
10 other plants had halted Data from Argentina tell a Mario Ravettino, president
operations due to logistical similar story, with exports of the ABC consortium of
disruptions. during the first 10 months Argentine meat exporters, said
of 2019 reaching a record that the decline is due to “port
In normal circumstances, 666,000 metric tons, and logistics difficulties caused by
international trade can China accounting for close quarantine measures, which
address temporary supply to 50% of sales. have also affected demand
disruptions or production patterns of beef.”
shortages in any given While 2020 was expected to
country, caused for example be another strong year for Brazil on the other hand
by disease or storms. Latin American producers, has doubled its March
The current situation is
unprecedented in that
all major producers in
the Americas could face
supply disruptions, with
45%
the US, Brazil, Argentina
and Uruguay accounting of international beef exports come from the US,
for an estimated 45% of Brazil, Argentina and Uruguay
international beef exports.
17shipments of beef to China Following reports of
compared to 2019, following infections within plants in
a slowdown during the first Rio Grande do Sul, state
two months of the year. prosecutors filed a lawsuit
With decreased demand to temporarily close two
from other major markets The greatest plants, in order to slow the
such as the European Union, spread of the virus.
exports are now even more challenge will be
dependent on China, which
accounted for 35% of sales
on the supply To try and increase worker
safety, Brazil’s Secretariat
in March. side and on of Health is also requiring
ENVIRONMENTAL AND
the industry’s all meat processors to
establish a contingency plan
ECONOMIC IMPACT capacity to to prevent, monitor and
In recent years, increased
continue supplying control Covid-19.
production of beef and products in the The plan calls for increased
grains has been tied to distancing and the
deforestation and loss
same way” installation of physical
of biodiversity in the barriers between workers,
Amazon. Farming of cattle use of personal protective
also generates significant equipment, staggered work
amounts of planet-warming shifts and active monitoring
methane. As long as meat exports of symptoms.
remain a fundamental
While a protracted reduction economic engine for Argentina has implemented
in demand from China and countries such as Brazil, similar guidelines, which
other major markets could Argentina and Uruguay – include changes in
in theory reduce some particularly on the back of production workflows to
of these environmental record sales to China – there reduce the risk of contagion,
pressures, lasting changes will be a strong incentive to increased sanitation
would take longer to continue production. requirements, and a
materialise. protocol if positive cases are
Mr Salemme believes that, detected.
Alejandro Salemme, a cattle short-term disruptions
producer and member notwithstanding, Argentinian Meanwhile in the US,
of the Argentinian Angus production will continue President Trump has
Association, says that “beef to grow, and that China taken the drastic step of
production cycles can last represents a huge untapped classifying meat plants as
two to three years, so any market for premium cuts, “critical infrastructure” in
changes in supply won’t be which have traditionally order to avoid a shortage
reflected from one day to been sold to Europe. of food amid coronavirus.
the next.” The decision has been
PUBLIC HEALTH controversial due its potential
So far there are no signs of CONSIDERATIONS implications on public health
decreased cattle farming and worker safety.
across Latin America, in As an essential industry,
spite of plant shutdowns food production has Lorival Luz, CEO of BRF,
and logistics disruptions. And largely been exempt from one of Brazil’s largest meat
while some US producers lockdown measures. But producers, said in recent
are slowing the growth of with rising infections within conference call that “the
their livestock to cope with meat plants, governments greatest challenge will be
plant closures, experts now face a difficult choice on the supply side and on
believe there has been no between public health and the industry’s capacity to
fundamental, long-term shift the economic impact of continue supplying products
in the supply outlook. shutdowns. in the same way.”
18 Bucking the trend: South American soy and beef soar in times of coronavirusFlávia Milhorance
The murky process of licensing the
Amazon’s meatpackers
Meatpackers in the Amazon are eyeing the Chinese market, but
export certifications are often the result of intense pressure and
neglect of environmental requirements
Politicians and
meatpackers in Brazil’s
Amazonian state of Pará
gathered for a celebration
in September 2019,
cheering the official
announcement that four
processing plants in the
state had won approval to
export to mainland China.
Photos show delighted
participants posing with
boxes of meat products.
A slaughterhouse in Mato Grosso state, Brazil
“The ability to enter the Photo: Alamy
Chinese market is something
that meat processing plants
in our state have been
requesting since 2011,” said size of Beijing, becoming
14
governor Helder Barbalho the state that has
who had lobbied hard for destroyed most rainforest
the licences. in Brazil during this period.
Decades of growth in cattle of the 22 Brazilian Environmental devastation
ranching have meant Pará meat plants was not mentioned
is now the state with the approved to export in publicly disclosed
largest herd nationwide. to China since 2019 documents about recent
At 20.6 million heads, it are in the Amazon agreements between
has 2.5 cattle for every Brazil and China on beef,
human inhabitant. At the as political and economic
same time, the region has pressures dominated the
also broken records for negotiations. The lengthy
deforestation, sharpening the world. And the certification process for
the focus on its contribution destruction has continued meat processing plants
to climate change. into 2020. Barbalho focuses almost exclusively
explained the fires were on sanitary standards,
RAMPANT DESTRUCTION “burning the forest to make as can be seen from
pasture.” In the last twelve the applications forms,
The Amazon region months, Pará lost almost hearings, and protocols
suffered a fire season in 3,000 square kilometres of analysed by Diálogo Chino
August 2019 that shocked forest, an area almost the for this article.
19Since 2019, China has
approved 22 new beef
processing plants, 14
located in the Amazon
region. The Amazon biome
now is home to almost
half of the Brazilian
meat processing plants
authorised to export to
China
Environmentalists are
alarmed by the sector’s
rapid growth: “Clear criteria
for controlling deforestation
and respecting the land
rights of indigenous
peoples and communities
should be mandatory for decades, although demand environmental operating
exports of Brazilian beef, is limited and concentrated licence are limited to waste
particularly when it comes on cheaper products, and water management
from biomes [that are] according to Thiago and noise and traffic
under attack,” says Adriana Bernardino, a livestock nuisance near the plant.
Charoux, spokesperson researcher at the Brazilian
for Greenpeace’s Amazon Centre for Advanced Meat processing plants
campaign. Studies in Applied are subject to ongoing
Economics. inspections, but these
For Pará’s vast beef do not monitor licence
farming sector, however, However, demand from renewals or the status
the China licences were Mainland China is rising, of embargos issued by
doubly welcome following largely due to the impact environmental protection
past freezes in the trade of African Swine Fever and agencies for deforestation.
because of food safety trade tensions with the
scandals. In 2017, an US. Gaining market access Once the meat processor
exposé caught food through China’s central has its SIF registration
inspectors conspiring to administration allows sales number (used in all
approve meat that was to all provinces, not just future inspections), it
unfit for consumption. Hong Kong, and sales are needs approval from the
International embargoes often of better meat with purchasing country and
followed, and China higher added value. an international health
temporarily halted new certificate.
export accreditations for “The Chinese market is
Brazilian meat processors. increasingly looking for Hong Kong’s market
quality and paying extra for access rules broadly
MEATPACKERS SEEK it,” says Bernadino. follow exporting countries’
MAINLAND MARKET protocols, meaning
DITCH MEATPACKERS’ Brazilian meatpackers
Meat exporters must follow EXPORT PERMITS can respond to direct
tougher rules to sell to requests for export without
China’s mainland market than To sell meat abroad or mediation by Brazil’s
to enter Hong Kong, and the nationwide, Brazilian federal government. Hong
mainland is now becoming meat processors must Kong’s requirements, set
Brazil’s main market. be registered with the out in an official letter
Federal Inspection from the Brazilian Ministry
Hong Kong has imported Service (SIF). However, of Agriculture (MAPA), are
Brazilian beef for two SIF’s requirements for its only that meat must be fit
20 Bucking the trend: South American soy and beef soar in times of coronavirusrequires meatpackers and
the Brazilian government
to comply with rigorous
standards covering a
plant’s production capacity
and sanitary conditions.
In a registration form,
China requires details of
veterinarians responsible
for inspection, potential
sources of pollution in
the vicinity, risk of cross-
contamination inside the
factory, the cleanliness
of the premises and
facilities during storage and
transportation, and water
treatment.
Besides ensuring quality
standards, entrepreneurs
must have the capacity
to meet growing demand:
“China is a giant in terms
of consumption, and
they need volume,” says
Jean Manfredini, Brazil’s
agricultural attaché in
Beijing.
As Philip Fearnside, an
authority on the subject,
points out, “This represents
a danger that deforestation
Fire in the Jaci-Paraná Extractive Reserve, in Porto Velho, Rondônia state, one
month after a presidential decree forbidding fires in the Amazon and Pantanal
in the Amazon may
Photo: Christian Braga/Greenpeace increase.”
UNCONTROLLED
PRODUCTION CHAINS
for consumption, without Weak Flesh investigation
contaminants or prohibited caught officials passing unfit Demand for high volumes
substances, subject to meat, prompting China to of beef have stoked the
inspections and originate freeze export permits. cattle ranchers’ interest in
from registered farms. the Amazon, a geographic
China’s central shift that originally began
Mainland China’s rules administration now in the late 1990s and early
are much tougher.
Authorities audit plants in
exporting countries, and
may also receive a list of
recommended companies for
local governments to assess.
152,000
The credibility of Brazil’s square kilometres of forest were deforested in the
SIF inspectors was cut to state of Pará in the six months up to June 2020
shreds when the Operation
212000s in response to foot One of the main obstacles Brazilian beef exports
and mouth outbreaks to better traceability is to China after Operation
elsewhere in Brazil. ‘cattle laundering’, where Weak Flesh began in
thousands of ranches act 2018 when Chinese
The Brazilian Ministry of as middlemen, providing inspectors delivered a
Agriculture responded to cattle not to the meat harsh judgement after
the crisis by tightening processors but to other, visiting only 11 of dozens
regulations and hiring more reputable farms. The of meat processing plants
inspectors. practice is common and recommended by the
cattle may spend up to 75% Brazilian government.
However, contact-tracing of their lives in the pastures
rules could provide a way of indirect suppliers who “[Their] report was not
to protect the Amazon if may be involved in illegal very favourable, excluding
environmental concerns deforestation and land grabs one [plant] and was full
were prioritized. In granting of questions about the
permits to meat exporters, The EU imposes stricter other 10,” said agriculture
both Hong Kong and requirements on livestock minister Tereza Cristina
mainland China require a tracing, which are da Costa Dias at a public
brief description of where summarized in a MAPA hearing. Costa Dias
the cattle have come from directive guiding inspectors: scheduled a trip to Asia
in order to ensure sanitary it stipulates that the in 2019 in an attempt to
quality from the point of monitoring process should rectify Brazil’s image.
origin. start when animals are first
transported and received Meanwhile, Pará’s meat
If this mechanism were and track their meat all industry readied itself to
strengthened, it could the way through to the fight for exports to China.
stop purchases from final, export-ready product. Governor Barbalho visited
areas where there is illegal The EU has excluded Pará Brazil’s capital more than
deforestation. and other Amazon states 10 times and took ranchers
from the list of exporting to lobby MAPA on behalf
“Big meatpackers are regions. of Pará’s meatpackers.
already moving towards State-level problems over
that,” said Bernardino, Nonetheless, a study environmental licensing
the livestock researcher, published in the journal and improved livestock
pointing to recent “Science” revealed that at monitoring were resolved,
promises by Marfrig and least 17% of beef exports although measures still
JBS to trace their entire to the EU from threatened fall short of what would
supply chains. But, on the biomes may be linked to be necessary to sever the
subject of adding further illegal deforestation. industry’s connections to
environmental protocols, illegal deforestation.
he said, “there would POLITICAL AND
have to be demand on ECONOMIC PRESSURE The agriculture ministry
meatpackers from the received petitions
consumer, retail side for China’s authorities have demanding transparency
this information and then shown themselves willing about China’s requirements
pressure to change the to exert pressure on from two federal deputies,
system.” Brazil within their current Fausto Pinato, chairman of
framework’s purely sanitary the Federal Commission
Today, the Brazilian rules on safe provenance. on Agriculture (PP), and
government monitors the Meanwhile, in Brazil tight Cristiano Vale (PL), a
movement of animals links between politicians rancher from Pará.
through compulsory and Amazon cattle
transport documentation, ranchers have sidelined Three major companies
while the meat industry environmental protection. dominate the industry:
monitors suppliers through JBS, Marfrig, and Minerva.
satellite data and audits. Bilateral talks to resume In terms of export volume,
22 Bucking the trend: South American soy and beef soar in times of coronavirusYou can also read
