Conference Agenda

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Session Overview
302RB: The role of supply-chain initiatives in reducing deforestation - Part B: Focus on Brazil
Friday, 26/Apr/2019:
10:30am - 12:00pm

Session Chair: Ximena Rueda
Session Chair: Kimberly Marie Carlson
Session Chair: Robert Heilmayr
Session Chair: Rachael Garrett
Session Chair: Eric F. Lambin
Location: MB-220
Main Building, room 220, second floor, west wing, 154 (+22) seats
Session Topics:
How do we support transformation?

Session Abstract

Expansion of commodity production has driven substantial deforestation in recent years. In response to pressure from civil society, lenders, and consumers over the corporate role in this forest loss, many companies that are part of tropical commodity supply chains have made commitments to environmentally friendly sourcing. These pledges often aim to alter land use in production landscapes to eliminate deforestation, protect local rights to land, and/or conserve biodiversity and carbon. Commitments are implemented through a variety of supply chain policies including sustainability certifications, market exclusion mechanisms, supply chain transparency disclosures, and corporate codes of conduct. Recent research demonstrates that fully implemented supply-chain interventions can have measurable impacts on producer behaviour and deforestation rates within target supply chains. However, these impacts vary widely by commodity and region of implementation and are insufficient to end global deforestation. Impact evaluations of supply chain governance have largely focused on estimating the direct effects of these policies. Questions about the relative effectiveness of different policies, spillovers of impacts from private governance, interactions with government policies, and unintended social consequences of private environmental policies have all been identified as requiring further research. Empirical analyses of implementation mechanisms and direct and indirect effects on land systems are critical for informing corporate supply chain policy design, as well as developing theoretical understanding of non-state market-driven governance. This session will present the current state of empirical research evaluating the impacts of supply chain governance of land use. The selected empirical evaluations will address questions such as 1) How are supply chain initiatives being designed and implemented? 2) Under what conditions are supply chain governance initiatives effective at meeting their stated goals? 3) What are the unintended consequences of supply chain initiatives on land systems? 4) How does private supply chain governance interact with public policy? The session will highlight the complex policy ecosystems in which zero-deforestation commitments are implemented and how multiple, parallel initiatives influence commitment effectiveness. Session Organizers: Kimberly Carlson, Rachael Garrett, Robert Heilmayr, Eric Lambin, and Ximena Rueda

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Full talk
ID: 239 / 302RB: 1
302R The role of supply-chain initiatives in reducing deforestation
Keywords: Zero-deforestation commitments, deforestation, cattle, Brazil

The impacts of zero-deforestation commitments on deforestation and slaughterhouse siting behaviours

Samuel Alexander Levy1, Rachael Garrett1, Petterson Vale2, Ricardo Vale2, Holly Gibbs2

1Boston University, United States of America; 2University of Wisconsin, United States of America

Cattle are the leading driver of deforestation in the Brazilian Amazon, as well as one of the key commodities driving tropical deforestation globally. Despite inconclusive evidence, supply chain initiatives have been heralded as a critical way to decouple economic production from environmentally destructive practices both in the Amazon and elsewhere. In the Brazilian cattle sector, this primarily has taken the form of collective zero-deforestation commitments such as the G4 Cattle Agreement. We use a novel methodological approach to determine whether these commitments have changed company location decisions or reduced deforestation in three Brazilian states, Rondônia, Mato Grosso and Pará, which collectively constituted 75% of the cattle herd of the Legal Amazon region. We quantified market exposure to zero deforestation commitments and associated reductions in deforestation by calculating the market share of committed slaughterhouses at the municipal level. This was paired with an analysis of the locations of new slaughterhouses by committed companies to identify if companies were avoiding expansion into regions with high deforestation risk. Our results show that companies who make zero-deforestation commitments are not avoiding deforestation hotspots, however a high municipal exposure to zero deforestation commitments is associated with reduced deforestation. We conclude that while commitments are not altering company decisions on where to expand, they are likely changing business practices and in turn resulting in reduced deforestation. However, for commitments to be impactful it requires a large percentage of the local market to be composed of committed companies, otherwise there continue to be ample opportunities to avoid or otherwise evade the commitments companies have made.

Full talk
ID: 373 / 302RB: 3
302R The role of supply-chain initiatives in reducing deforestation
Keywords: Soy Moratorium, Brazil's Cerrado, avoided deforestation, future deforestation risk

Brazil’s Cerrado soy moratorium: estimating impacts on production and native vegetation area

Aline Soterroni1,2, Fernando Ramos2, Joseph Fargione3, Leandro Baumgarten4, Pedro Andrade2, Aline Mosnier1, Johannes Pirker1, Michael Obersteiner1, Florian Kraxner1, Gilberto Câmara2, Alexandre Ywata5, Stephen Polasky6

1International Institute for Applied System Analysis, Laxenburg, Austria; 2National Institute for Space Research, São José dos Campos, Brazil; 3The Nature Conservancy, Minneapolis, USA; 4The Nature Conservancy, Brasília, Brazil; 5Institute for Applied Economic Research, Brasília, Brazil; 6University of Minnesota, St. Paul, MN, USA

Brazil’s Cerrado is a unique tropical savanna and a global biodiversity hotspot under threat of extinction due to land use conversion to agriculture. Cerrado is the location of the recent Brazil’s agricultural boom, especially soybeans expansion. Based on GLOBIOM-Brazil model, we estimated the impact of extending the soy moratorium (SoyM) from the Brazilian Amazon to the Cerrado biome by projecting future soybeans expansion in Brazil under scenarios with and without the SoyM. GLOBIOM-Brazil is a regional version of GLOBIOM model, a global bottom-up recursive dynamic partial equilibrium model that simulates the competition for land among the main sectors of the land use economy (agriculture, forestry and bioenergy), subject to resources, technology and policy restrictions. Expanding the soy moratorium to the Cerrado would prevent the direct conversion of 3.6 million hectares of native vegetation to soybeans between 2021 and 2050. On the production side, the SoyM expansion would cause a reduction of 1.1 million hectares or 2% of Brazil’s soybean area by 2050. We also estimated the area of native vegetation at risk of being lost per 1000 ton of soybeans produced in the Cerrado, between 2021 and 2050, per trader, trader association or consumer market. To this end, we used the scenarios projections from GLOBIOM-Brazil and the market share of companies tracked by TRASE dataset for the year 2015. Our results indicate which traders or export markets would contribute most to future soy-related deforestation of the Cerrado’s vegetation.

Full talk
ID: 515 / 302RB: 4
302R The role of supply-chain initiatives in reducing deforestation
Keywords: Brazilian Amazon, Cattle agreements, Deforestation, Land intensification, Supply sheds

Estimating the influence of meatpackers with zero-deforestation commitments on cattle travel distances in the Brazilian Amazon

Amintas de O. Brandao Junior, Lisa L. Rausch, Holly K. Gibbs, Jacob Munger, Matthew Christie

University of Wisconsin-Madison, United States of America

Since 2009, supply chain agreements championed by governmental agencies and NGOs have been pushing meatpacking companies to reduce deforestation associated with cattle production in the Brazilian Amazon. One challenge is the limited reach of the cattle agreements’ current implementation, including the existence of major slaughterhouses without agreements or monitoring systems. In this study, we combined cattle movement data, properties boundaries, and roads network, to identify the cattle supply sheds of direct and indirect suppliers of meatpackers located in the states of Mato Grosso, Pará, and Rondônia. Next, we documented the space-time patterns of deforestation and land intensification between slaughterhouses that are covered by the cattle agreements and those that are not. The study period was from 2013 to 2017 and we show that the largest slaughterhouses, including those covered by the agreements, buy more frequently from a smaller number of ranches without ongoing deforestation and located closer to the plant. However, cattle produced on farms with deforestation travel farther to reach plants that do not monitor for deforestation, which is an indication of leakage. Also, the deforestation levels were lower and the land was more intensified in the regions near to the plants that signed the agreements than around those that did not sign. Our results demonstrate the importance of sector-wide adoption and implementation of the cattle agreements by highlighting the extent to which non-compliant producers can go to avoid conforming to deforestation-free production, given the opportunity.

Full talk
ID: 579 / 302RB: 5
302R The role of supply-chain initiatives in reducing deforestation
Keywords: Soy Moratorium, zero deforestation, assurance system, Savanna, Amazon

Soy Moratorium in Brazil: the evolution of the governance structure, the assurance system and future challenges

Marina Piatto, Lisandro Inakake, Isabel Garcia-Drigo

Imaflora, Brazil

The Soy Moratorium is the most successful zero deforestation commitment in place in Brazil. The Moratorium was established in 2006 after the Greenpeace report Eating up the Amazon pointed out that soybeans were being increasingly grown in the Amazon biome and had become a significant driver of deforestation in the region. It is a voluntary agreement made by the soybean production chain with the aim of putting an end to deforestation to make way for soybean crops in the Amazon biome by making sure that soybean trading companies will not buy raw materials produced in areas deforested after 2008. Since the beginning, the civil society played a significant role in the building and implementation of the commitment. The Soy Working Group includes national and international NGOs, representatives of traders and the Brazilian Association of Vegetable Oil Industries and, since 2008, Brazilian government representatives. This group governs the initiative defining and implementing the assurance system (monitoring, verification, and reporting). The purpose of this contribution is to analyze the structure of the governance system, how the assurance system has evolved and the challenges of expanding the initiative to the Brazilian Savanna (Cerrado). The empirical analysis draws in a historical review of the rule building process and implementation, completed by interviews with key stakeholders involved in the initiative. Our results show that the governance structure has supported a more robust assurance system with an increasing number of traders hiring independent audits year by year. Nevertheless, there is still room for the improvement of the transparency of audit results. Finally, the expansion of a similar commitment to the Brazilian Savanna will be hardly achieved only with command control actions. There is a need for a combination with economic incentives.

Flash talk
ID: 493 / 302RB: 6
302R The role of supply-chain initiatives in reducing deforestation
Keywords: Brazilian Amazon, beef supply chain, zero deforestation, governance

Progress and limits of zero-deforestation commitments of the beef chain in the Brazilian Amazon

Isabel Garcia-Drigo1, Marie-Gabrielle Piketty2, Pablo Pacheco3, Rene Poccard-Chapuis2, Marcelo Thales4

1Imaflora, Brazil; 2Cirad; 3WWF; 4Museu Emilio Goeldi

The beef industry has been the main driver of deforestation in the Brazilian Amazon in the last 40 years. This situation has started to reverse in the last ten years, thanks to two agreements between the main meatpackers, NGOs and the government, in which the former commit to stop using any of their suppliers involved in illegal deforestation. The purpose of this contribution is to analyze the features of the main institutional arrangements that emerged aimed at guaranteeing that cattle suppliers do not cause further deforestation, their progress, and limits toward achieving those goals. Our analysis draws on a historical review of the events underpinning the process of building and adopting rules in the beef supply chain, complemented with information from semi-structured interviews with key stakeholders in the public and private sector, and civil society, in the main beef producing states in the Brazilian Amazon. We show that meatpacking companies’ effective control of cattle ranchers only got underway with the implementation of more stringent and innovative public policies. More, the existing cattle agreements have enabled more progress towards eliminating deforestation but control only occurs over direct suppliers of the slaughterhouses, minimal law compliance is required, and the accountability mechanisms of the agreements are still weak. We discuss possible pathways to improve the effectiveness of existing commitments.

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