Cargill Inc. last week announced it has mapped out its entire supply chain for soybeans in Brazil, where the destruction of forest to make land to grow the crop has produced an environmental conflict with global attention.
With the maps, executives at the Minnetonka-based agribusiness giant say they are learning more about where, and by whom, forest land is being converted. "The objective is to transform our supply chain, or the farming sector, to be deforestation- or conversion-free," said John Hartmann, Cargill's top executive for sustainability in supply chain.
Environmentalists for years have urged Cargill to use its purchasing power and influence to slow the changeover of forest for farming in Brazil and elsewhere.
As the world's largest food processor and trader, Cargill makes money from the rising demand for food and the agricultural practices to supply that global need, drawing scrutiny and often criticism from people seeking to preserve existing habitats.
That tension is especially high for Cargill in Brazil. The country, which had little soybean farming 50 years ago, now leads the world in production and exports, influencing pricing globally and even the income of U.S. farmers.
Millions of acres of forests were cut down to create new farmland in Brazil. That process slowed after 2008 because of regulations. However, President Jair Bolsonaro last year loosened some rules, leading to a sharp increase in logging and clearing of land that may become used for crops.
For more than a year, Cargill has been mapping with single GPS datapoints the farms it deals directly with, as well as indirect middlemen, in Brazil. It recently finished that mapping and aims to complete it in Bolivia, Paraguay and Argentina later this year.
In the report Cargill published last week, the company for the first time estimated its soybean purchases based on land origin.
For the 2018-19 crop year — being in the southern hemisphere, South America's growing season begins around September and lasts until April — Cargill said 95.7% of its soybean purchases in Brazil were from conversion-free land, or land that was not recently deforested.
"There's large amounts of land already converted to other agriculture uses, such as pasture land," Hartmann said. "To create an environment where farmers are encouraged to expand [crop growing] on areas that are like that rather than native vegetation is all part of the work that goes behind this."
The company's environmental critics say Cargill and its competitors give farmers and themselves too much slack over the timing of when former forest is used for crops.
"It really depends when that land was deforested," said Glenn Hurowitz, chief executive of Mighty Earth, an environmental group in Washington sharply critical of Cargill's work in South America. "They don't know because they're not actually tracing that."
The group's data-mapping expert, Asha Sharma, said she would like more details from Cargill about how it arrived at its estimates and the Brazilian community data it used for comparisons. As well, she said that getting an accurate depiction of the growth of cropland will involve mapping farm borders, not just identifying them with a single point.
Hartmann said that's the next goal for Cargill's mapping. "Then we can monitor within a physical boundary instead of the more general approach that's being done now," he said.
With its work so far, Cargill appears to have an edge among large food processors in tracing soybean supplies in South America. Cofco International Ltd., the trading unit of China's largest food processor, last week said it aims to have full traceability there by 2023.
Cargill since 2006 has upheld a ban on soybean purchases in the Amazon, but its operations in the Cerrado and Gran Chaco continue to be scrutinized, even by business partners. Last week, Norway-based Grieg Seafood, a salmon producer that works with Cargill's aqua nutrition business, excluded the Cargill unit from proceeds of a bond raised to commercialize new fish feed. It cited a reputational risk tied to Cargill's work in Brazil.
