The sustainability of soy farming has been at the center of many discussions this year, with a moratorium being called for by 84 companies and trade groups, including salmon farmers coming together just last week.
The Cerrado is a vast tropical savanna region of Brazil that includes the states of Goias, Mato Grosso do Sul, Mato Grosso, Tocantins, Minas Gerais and the Federal District.
Its unique ecosystem, home to over 5 percent of global biodiversity and a store of nearly 13.7 billion metric tons of carbon.
One of the most important Brazilian regions for water production it provides 40 percent of Brazil’s freshwater used in agriculture.
Soy represents more than 80 percent of the current Cerrado cropland.
There are currently 22 million hectares of additional agricultural land in the Cerrado that is highly suitable for soy expansion that could than double current soy production in the Cerrado, without further deforestation.
Source: Grieg Seafood
In the midst of companies trying to find solidarity in proofing their supply chains, feed and animal nutrition giant Nutreco, salmon farmer Grieg Seafood, and top retailer Tesco are putting money on the table for a new five-year initiative that aims to incentivize soy farmers in the Brazilian Cerrado.
Roughly $15 million (€13.5 million ($15 million)) has been collected so far, with Tesco contributing £10 million (€11.8 million ($13.1 million)/$13.1 million). Nutreco, which owns aquaculture feed producer Skretting, has pledged to commit €1 million ($1.1 million) over the five-year period, hoping that in the next few months other companies will join the pledge.
"This is real interesting because [we] are the first movers, and we are trying to inspire other companies to see this is a strong commitment and come in and contribute," Nutreco Corporate Sustainability Director Jose Villalon told IntraFish.
"Deforestation continues, and forest fires in the Amazon that we experienced this year are not trivial. They are not random," Villalon said.
"The good thing about this international fund is that we're not talking about illegal deforestation, but we are talking about legal deforestation."
Studies indicate that $250 million (€225.3 million) is needed over the period in order to distribute the funds to farmers in a way that will effectively half soy-related deforestation in the Cerrado.
"There is nothing else that is providing an industry-wide solution to halt soy-related deforestation in the Cerrado. This is the only thing on the table now," Grieg Global Communications Manager Kristina Furnes told IntraFish.
Grieg has committed to contribute with $2 (€1.80) per metric ton of Brazilian soy the company uses in its fish feed, in accordance with the guidelines of the initiative. The company's annual soybean imprint is approximately 30,000 metric tons, which brings the pledge to roughly $300,000 (€270,392) for the five year period.
"Finding new feed ingredients, both marine and soy, is something industry needs. [Grieg] is in the process of figuring out our strategy for this."
The company also signed the moratorium on soy coming from the Amazon.
"The Amazon and Cerrado are two different areas, so they require two different solutions," Furnes said. "The question is... how can you solve deforestation in all different areas? For the Amazon, we strongly support the soy moratorium and that will continue. The Cerrado is different. It has much higher soy production, and we think financial incentives for farmers to instead expand on existing agricultural land can be the solution."
Furnes highlights that this is a solution that local farmers have been calling.
Big business taking ownership
"I think this is the new trend. If the government cannot take care of things, business will," Villalon said, citing that despite Brazil's "powerful and progressive" forest code, enforcement remains an issue.
"We need to address this as a business. We're, in a way, fueling that, by not asking them to behave properly."
The current initiative began as a discussion founded on a statement of support made back in October 2017, with Nutreco being the only feed company on the list. At present, there are 140 signatories to the statement.
According to Villalon, climate-neutrality is going to play an even bigger role in Nutreco's overarching sustainability strategy, with the company aiming to set it's science-based targets for reducing carbon emissions by the first half of the next year.
"[Science-based targets] require that companies engage with suppliers and demand they reduce their emissions too, and [they] need to monitor that. Or whether you like it or not, [companies] will be dragged into it by [their] hairs into science-based targets."