Brazil soy industry’s exit from moratorium on using Amazon land could spur deforestation

SAO PAULO (AP) — For nearly 20 years, Brazil’s largest soy producers assured buyers that their harvest — the world’s biggest — wasn't grown on land cleared from Amazonian forests. The pledge, known as the soy moratorium, has been widely credited with helping curb rainforest loss.

That changed this week when the biggest grain traders announced they would withdraw from the agreement, threatening not only its survival but also President Luiz Inácio Lula da Silva’s pledge to end deforestation by 2030.

On Monday, the Brazilian Association of Vegetable Oil Industries, or ABIOVE, the soy industry association representing some of the world’s biggest soy traders, said it would no longer take part.

Environmentalists and government officials said the withdrawal essentially ended the agreement, even though no participant has formally declared it over.

“If they withdrew from the pact, then a marriage with only one husband or only one wife is no longer a marriage, right?” André Lima, secretary for deforestation control and land‑use planning at the Ministry of the Environment, told The Associated Press.

“I understand that, as of now, the moratorium has come to an end,” he added.

Brazil is the world’s largest soybean producer, accounting for about 40% of global crops. The country produced 171.5 million metric tons in the 2024–25 season, according to the U.S. Department of Agriculture. ABIOVE’s members include some of the industry’s biggest companies, including Cargill, Cofco International, Bunge, Amaggi and JBS.

The Amazon, the world’s largest rainforest, plays a critical role in regulating the climate far beyond South America. Scientists warn that forest loss could accelerate global warming and disrupt agriculture as far away as the U.S. Midwest and parts of Europe.

How agreement came about

After reaching record levels in the 1990s and 2000s, deforestation declined until former President Jair Bolsonaro’s 2019–2022 term, widely criticized for weakening environmental protections. Under Lula's administration, deforestation has fallen again, reaching its lowest level in a decade last year.

Launched in 2006 as a response to pressure from environmental groups and international buyers, the moratorium is a voluntary commitment rather than law. Major soy traders agreed — and the Brazilian government later endorsed — a ban on purchasing soy grown on Amazon land cleared after July 2008.

In 2016, the moratorium was renewed without an end date, with the understanding that it would remain in force until members agreed it was no longer necessary.

The system has relied on satellite monitoring and government farm registry data to detect new deforestation in the Amazon biome. Traders were required to cut off purchases from farms found in violation, and independent auditors review their supplier lists annually.

Deforestation in municipalities tracked by the moratorium declined by 69% between 2009 and 2022, according to the Brazilian agriculture and conservation group Imaflora. Soybean crops in the Amazon increased by 344% during that period, which Imaflora said was mostly a result of using fields previously used for cattle ranching.

Tax incentives over deforestation pledge

Major soy traders associated with ABIOVE withdrew from the moratorium after legislation in the state of Mato Grosso ended tax benefits for companies participating in the pact as of Jan. 1.

Mato Grosso is Brazil’s top soy-producing state. Lucas Beber, president of the state’s Soy Producers Association, told the AP that companies in the agreement receive about 4 billion reais ($743.5 million) a year in tax incentives, according to state estimates.

Lima, from the Environment Ministry, said the moratorium completed a successful 20-year cycle and that companies remain barred from buying soy grown on illegally deforested land, facing penalties if they do. Ending the commitment would allow soy production on land legally cleared in past years, he added.

In a statement, ABIOVE said it had begun the withdrawal process, calling the moratorium a nearly 20‑year effort that “left an undeniable legacy” and made Brazil a global reference in sustainable production.

“The legacy of monitoring and the expertise developed over nearly 20 years will not be lost. Each organization will individually meet the strict demands of global markets, while also relying on Brazilian authorities for the full implementation of a new regulatory framework to ensure that Brazil’s international commitments are upheld,” the association said.

Soy producers have long argued that the moratorium hurt business because it is stricter than Brazilian environmental law. Under national rules, farmers in the Amazon must preserve 80% of their land and may legally clear the remaining 20%, while the moratorium bans any deforestation, even when permitted by law.

Beber, from the Mato Grosso Soy Producers Association, said the agreement overruled environmental legislation and singled out soy farmers. He added that it was designed to meet European market demands, which now account for less than 14% of Brazil’s soy exports.

Soy expansion could lead to forest loss

Ana Paula Valdiones, from the Mato Grosso-based policy watchdog Observa-MT, said the new state law was as a major environmental setback that would hinder conservation initiatives.

“The weakening or end of the soy moratorium could lead to increased deforestation, whether through the direct conversion of remaining native vegetation, the expansion of the agricultural frontier or land speculation,” she said.

Greenpeace, which supported the moratorium, also said the end of the commitment could fuel unchecked soy expansion in the Amazon, driving up deforestation and Brazil’s greenhouse gas emissions.

A preliminary study by the nonprofit Amazon Environmental Research Institute said ending the moratorium could raise deforestation in the Amazon by up to 30% by 2045, undermining Brazil’s environmental goals.

Lima, from the Environment Ministry, disputed the estimate, saying he was unfamiliar with its underlying assumptions, including whether it accounts for individual company commitments or foreign laws restricting market access for products linked to deforestation.

He said soy market growth would likely increase legal deforestation, which now accounts for about 10% to 15% of total forest loss. But he added that overall deforestation could continue to fall — more slowly, however— if the government keeps up its enforcement efforts.

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