Case Studies

An investigation by Argentine TV show Periodismo Para Todos (PPT) revealed significant smuggling of soy from Argentina to Paraguay. This illicit trade exploits the same cross-border blindspots that are used for drug trafficking. Smugglers transport soy into Paraguay to circumvent Argentina’s hefty 30% export tariffs. The soy are transported via the Paraná River, where Paraguayan boats either collect soy loads from Argentine boats or dock at clandestine ports to await truck deliveries. Once in Paraguay, the soy are recorded as Paraguayan produce and exported. This contraband trade has been fuelled by rising production costs in Argentina and falling global soy prices, making smuggling a more profitable option for many farmers. The impact of this illicit trade is evident in industry statistics. Between 2011 and 2015, while Argentina’s soy production increased by 8%, exports fell by 6%. In contrast, Paraguay saw a 10% rise in production but a dramatic 62% increase in exports, indicating the scale of the contraband operation. 

Source: https://insightcrime.org/news/brief/argentina-paraguay-smugglers-use-drug-routes-for-contraband-soybeans/ 

Keywords: Latin America, Argentina, soy, trade and transport, tax evasion, smuggling

According to an article by Mongabay, Bolivia is facing a severe deforestation problem due to soy plantations, with satellite data showing that soy plantations were responsible for over 900,000 hectares (2.2 million acres) of deforestation between 2001 and 2021. Nearly quarter of this deforestation was caused by Mennonite communities, who legally purchased the land with the intention of expanding their simple, rural lifestyles. This new understanding of Mennonite activity in Bolivia comes from a new data set from Global Forest Watch, which combined soy plantation mapping with forest loss imagery to determine soy-driven deforestation. Mennonite soy farms have been a main driver of deforestation in the Beni and Santa Cruz departments, where vulnerable areas like the dry forest biome of Chiquitanía are already suffering from drought and fires caused by climate change. The figures come from a new Global Forest Watch data set on soy plantations, which was merged with forest loss imagery to determine soy-driven deforestation.

Keywords: Latin America, Bolivia, soy, primary production, deforestation

Source: https://news.mongabay.com/2023/02/bolivia-has-a-soy-deforestation-problem-its-worse-than-previously-thought/

The Global Witness report titled “Empty Promises: Cargill, Soy, Banks and the Destruction of Bolivia’s Chiquitano Forest” reveals that US food giant Cargill has directly purchased soy from farms in Bolivia where more than 20,000 hectares of forest have been razed since 2017. The report suggests that Cargill is systematically failing to collect key data about the origins of its soy supplies in Bolivia, casting serious doubt on its commitments to achieving fully traceable and “deforestation-free” supply chains. The report also reveals that Cargill’s global operations have been bankrolled by financial institutions including Barclays, BNP Paribas, HSBC and Santander, despite these firms’ pledges to eliminate or reduce deforestation from their portfolios. The report concludes with a series of urgent recommendations to the EU and UK, US and Bolivian governments, to the world’s biggest and most influential banks, and to Cargill itself.

Keywords: Latin America, Bolivia, soy, deforestation

Source: https://www.globalwitness.org/en/campaigns/forests/empty-promises-cargill-soy/#:~:text=Soy%20is%20Bolivia's%20top%20crop,for%20agriculture%20is%20likely%20illegal.

A study found that tax havens offer a major conduit through which investors can fund agribusiness in tropical areas; 68% of all investigated foreign capital flowing into nine of the top companies in the soy and beef sectors in the Brazilian Amazon was transferred through tax havens between 2000 and 2011. A large proportion of this was through the Cayman Islands. The report noted that the secrecy and transparency offered by such havens appear to be important to those investing large sums in agribusiness companies responsible for significant land conversion in the Amazon, likely because it protects them and allows them to more thoroughly conceal their involvement. 

Keywords: Latin America, Brazil, cattle, soy, primary production, tax evasion

Source: https://www.nature.com/articles/s41559-018-0497-3  

According to Mongabay, it was uncovered in February 2023 that three landowners had orchestrated the largest single instance of deforestation in the Brazilian Amazon's history, clearing 6,469 hectares of forest in Pará state. This large-scale land grab, conducted between February and May 2020, cost at least $2.5 million and is expected to yield nearly $20 million in profits from selling the land for soy farming or cattle ranching. This took place along the BR-163 highway, between the districts of Castelo dos Sonhos and Vila Isol, regions known for their economic activities, including gold mining, timber, cattle, and soy farming. The land, initially public and belonging to the Brazilian federal government, was illegally appropriated and cleared without environmental authorisation. This deforestation, larger than the area of Manhattan, represents a significant loss of biodiversity and a contribution to climate change, as well as a breach of Brazilian environmental laws. The three key figures behind this land grab are Jeferson de Andrade Rodrigues, Delmir José Alba, and his brother Augustinho Alba. They all have a history of environmental fines and infractions.

Keywords: Latin America, Brazil, cattle, primary production, illegal deforestation, agriculture

Sources: https://news.mongabay.com/2023/02/the-20m-flip-the-story-of-the-largest-land-grab-in-the-brazilian-amazon/

A 2023 investigation uncovered that seven agribusiness giants, including Bunge, Cargill and COFCO, bought grains, notably soy, from Brazilian farmers fined for illegal cultivation on Indigenous lands in Mato Grosso. However, the grain sales invoices failed to identify the farms as being inside the Indigenous lands, falsely stating other lands of origin to allow the business to take place. In addition, the investigation found that five identified producers fined by IBAMA in 2018 for cultivating crops within Indigenous lands continued to make sales to large international grain traders during the periods of interdiction from 2018 to 2019. A practice of ‘grain laundering’ was used to facilitate this illegal trade. This practice involves mixing illegally produced grains from conservation units, seized lands, or interdicted areas with legally planted and harvested soy and corn, thereby concealing the irregular origin of a portion of the crop. The close proximity of these farms, listed on invoices as the origin of the produce, to Indigenous lands facilitated this ‘grain laundering’. Grain laundering was openly acknowledged by farmers in the Paresí Indigenous region in March 2019. 
  

Keywords: Latin America, Brazil, soy, primary production, Indigenous rights, fraudulent documentation, grain laundering
  

Sources:  https://news.mongabay.com/2023/05/agro-giants-buy-grains-from-farmers-fined-for-using-indigenous-land-in-brazil/ 

A criminal complaint has been fined against several French banks, accusing them of money laundering and financing meat companies driving deforestation in Brazil. From 2013 to 2021, the four French banks involved, BNP Paribas, Crédit Agricole, BPCE, and AXA, invested nearly $70 million in bonds issued by leading Brazilian meat companies, generating about $11.7 million in profits. An analysis of JBS and Marfrig slaughterhouses, financed by such investments, in Pará and Mato Grosso found that over 50% and 40% of suppliers, respectively, showed evidence of deforestation and intrusion into Indigenous lands. The founder of the NGO Harvest, that contributed to initiating the complaint, emphasised that banks have an obligation to prevent money laundering and must exclude actors profiting from illegal deforestation. In response to the complaint, Crédit Agricole and BPCE did not comment, while BNP Paribas and AXA provided statements emphasising their commitment to ESG standards.  

Keywords: Latin America, Brazil, cattle, primary production, money laundering, Indigenous rights, illegal deforestation

Sources:  https://news.mongabay.com/2023/11/french-banks-accused-of-money-laundering-linked-to-amazon-deforestation/ 

https://www.asso-sherpa.org/complaint-filed-against-french-banks-for-money-laundering-and-concealment-of-proceeds-from-illegal-deforestation-in-the-amazon 

A legal complaint against the US-based agricultural giant Cargill has been filed following its failure to adequately deal with its participation in soy-driven deforestation and human rights violations in Brazil. Cargill allegedly failed to implement adequate monitoring methods to oversee the vast quantities of soy it trades, handles at its ports, and ships to global markets. This deficiency prevented the company from identifying and eliminating links to deforestation and human rights abuses, thereby breaching its legal due diligence responsibilities. Due diligence deficiencies include a lack of proper environmental due diligence on soy bought from third-party traders, no due diligence on soy owned by other companies passing through its ports and failure to address indirect land use change. The complaint also highlights human rights failures, including forced displacement and violence against land defenders linked to Cargill’s operations, and the destruction of traditional ways of living due to deforestation.  

Keywords: Latin America, Brazil, soy, primary production, human rights violations

Sources: https://www.clientearth.org/latest/press-office/press/agricultural-giant-cargill-faces-legal-complaint-over-deforestation-and-human-rights-failings-in-brazil/ 

According to Mongabay, the expansion of the soy industry in Hopelchén, Campeche, Mexico has led to devastating levels of deforestation of the Mayan jungle over the past two decades. The region lost at least 153,809 hectares of tree cover, driven by the rise of industrial agriculture and land privatisation. Despite the lack of official authorisation for deforestation, satellite images reveal extensive illegal clearing, primarily by Mennonite colonies, who have transformed vast forest areas into soy fields since 2004. This illegal deforestation has led to severe environmental degradation, including loss of biodiversity and disruption of local ecosystems. In addition, government policies and subsidies, such as those for productive conversion and contract agriculture, have further incentivised soy cultivation, notably by large-scale producers, at the expense of traditional corn farming and forest preservation. The unregulated deforestation has also affected the livelihoods of local communities, particularly beekeepers. Their income and way of life depend on the forest. However, the intensive use of pesticides associated with soy cultivation has led to significant bee deaths, triggering legal battles and community resistance. The devastation in Hopelchén is mirrored in other parts of the Yucatan Peninsula, with similar patterns of deforestation observed in municipalities like Tizimín and Bacalar.  

Keywords: Latin America, Mexico, soy, primary production, deforestation, illegal deforestation

Sources:  https://es.mongabay.com/2022/08/soya-deforestacion-en-la-selva-maya-en-mexico/ 

An investigation by Argentine TV show Periodismo Para Todos (PPT) revealed significant smuggling of soy from Argentina to Paraguay. This illicit trade exploits the same cross-border blindspots that are used for drug trafficking. Smugglers transport soy into Paraguay to circumvent Argentina’s hefty 30% export tariffs. The soy are transported via the Paraná River, where Paraguayan boats either collect soy loads from Argentine boats or dock at clandestine ports to await truck deliveries. Once in Paraguay, the soy are recorded as Paraguayan produce and exported. This contraband trade has been fuelled by rising production costs in Argentina and falling global soy prices, making smuggling a more profitable option for many farmers. The impact of this illicit trade is evident in industry statistics. Between 2011 and 2015, while Argentina’s soy production increased by 8%, exports fell by 6%. In contrast, Paraguay saw a 10% rise in production but a dramatic 62% increase in exports, indicating the scale of the contraband operation. 

Source: https://insightcrime.org/news/brief/argentina-paraguay-smugglers-use-drug-routes-for-contraband-soybeans/ 

Keywords: Latin America, Paraguay, trade and transport, soy, tax evasion, smuggling