Investor Presentaiton
WHEN WILL BRAZILIAN AGRIBUSINESS
DISENTANGLE ITSELF FROM DEFORESTATION?
This study uses an innovative approach to
demonstrate that by devaluing land prices in
93.5% of Brazilian municipalities, deforestation
benefits only those producers who have the
conditions to increase their cultivated area. It
also demonstrates that this is to the detriment of
those producers who are unable to increase their
cultivated area, due to financial, management,
scale, labour force or land supply limitations.
If you are a producer that increased
your area of cultivation over the 2006-
2017 period, deforestation was a
subsidy for your land acquisition, even
if you did not cut down a single tree.
However, if we look more closely, benefits
obtained by producers who expanded their
areas are largely concentrated in 1% of
municipalities and 2.4% of establishments.
A very small portion of the total number of
municipalities and agricultural producers
actually benefited in any real way.
Producers who bet on the intensification
strategy, instead of expanding their cultivated
area to increase production, now have one
more piece of evidence for the harmful
effects of deforestation. Of course, this is on
top of deforestation's well-known negative
impact on climate change, and on the image
of Brazilian producers among consumers
who demand environmental compliance.
Given this study's evidence that any profit
derived from deforestation is concentrated
among a small portion of producers, coupled
with the well-established consensus that it
is no longer necessary to deforest in order
to produce, we must examine why Brazilian
agribusiness, in large part, does not take a
stand against those who, in order to expand
their production capacity, choose to increase
their cultivated area through deforestation.
In practice, a silent tolerance of illegal
deforestation continues to pervade, as does
the defence of legal deforestation. Sector
leaders have failed to mobilise the full
force of their political weight to lobby the
federal government and parliamentarians
- especially the Frente Parlamentar da
Agropecuária - on a number of issues:
demanding effective actions for combatting
illegal deforestation and land grabbing in the
Amazon and Cerrado, halting the dismantling
of environmental legislation, and putting an
end to the routine land title regularisation acts
that effectively reward those who deforest.
Furthermore, in order to disentangle
agribusiness from deforestation, concrete
measures are needed to ensure the
traceability of suppliers' production chains,
the compulsory registration and geo-
referencing of properties, and the regulation
and official monitoring of this data.
Only with reliable official information about
those who deforest will investors be able to
properly direct resources towards companies
and producers who are truly committed to
environmental preservation. Likewise, with
this information at their disposal, consumers
can make better-informed choices and citizens
will know how and where public resources
are actually being channeled (subsidised
credit, debt amnesty, tax exemption, etc.).
6 See statement (in Portuguese) by the Minister for Agriculture, Livestock and Supply (MAPA), Tereza Cristina, on 23/01/2020,
recorded by Folha de S. Paulo newspaper at <https://www1.folha.uol.com.br/ambiente/2020/01/nao-precisamos-
desmatar-para-comer-basta-aumentar-a-produtividade-diz-tereza-cristina.shtml> accessed on 25/01/2022.
7 The Brazilian Farming Parliamentary Front.
HOW DOES BRAZILIAN AGRIBUSINESS BENEFIT FROM DEFORESTATION?
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