The Brazilian Association of Vegetable Oil Industries (Abiove), which brings together traders such as Cargill, Bunge, and Amaggi, announced on Monday its withdrawal from the agreement in which it had committed not to buy soy grown in deforested areas of the Amazon.
The announcement came four days after a regional law from the government of Mato Grosso, in the western part of the country, came into force, which bars the granting of tax incentives to signatories of the so-called Soy Moratorium.
The Moratorium is a voluntary agreement signed in 2006 by soy traders that prohibits the purchase of soy produced on deforested lands in the Amazon since 2008.
Environmental groups consider that this agreement has been decisive for the preservation of the world’s largest tropical rainforest over the last two decades.
Abiove’s withdrawal, however, jeopardizes the agreement, since this employers’ association includes the main soy traders in Brazil, which is the world’s largest producer and exporter of this oilseed.
The Moratorium has faced criticism from farmers who oppose environmental restrictions on their products and who found an ally in the Mato Grosso state government.
However, the state law is being reviewed by the Supreme Court, which is assessing its constitutionality.
The state governor, Mauro Mendes, welcomed Abiove’s decision, which, on the contrary, was criticized by environmental organizations.
Environmentalists recalled that deforestation in the Amazon fell by 69% between 2009 and 2022, thanks to the moratorium, which did not prevent soy production in the areas in question from rising by 344% in the same period.
