World’s largest beef producer fined after buying cattle raised on illegally deforested land in Brazil

Monday, March 27th, 2017

JBS, the world’s largest beef producer, has bought livestock raised in illegally deforested areas in the state of Para, according to a recent investigation by IBAMA, the Brazilian environment agency. Greenpeace has cut ties with the company, a pioneer of ‘zero deforestation’ pledges, as a result.

IBAMA’s Operação Carne Fria (Operation Cold Meat), which started 10 months ago, revealed last week that two slaughterhouses belonging to JBS, a Brazilian company, have bought 49,468 heads of cattle from embargoed ranches. The operation has uncovered a total of 14 slaughterhouses – including the two owned by JBS – that have bought 58,879 heads of cattle from 26 embargoed farms. The revelations represent something of a ‘perfect storm’ for the Brazilian beef industry, coming hot on the heels of an even larger scandal, involving the corrupt evasion of crucial sanitary controls. That scandal, stemming from a separate government investigation, led the EU and China to briefly suspend imports, after Brazilian federal police revealed evidence of widespread bribery of health inspectors to turn a blind eye to the processing of rotten meat and other unsanitary practices.

Cattle being raised on a ranch embargoed by IBAMA, the Brazilian environment agency ©Piero Locateli / Repórter Brasil

IBAMA imposes embargoes on ranches that are found to have committed illegalities, such as illegal deforestation or other types of environmental damage. An embargoed ranch is banned from any kind of economic activity, including raising livestock or cultivating crops.

These slaughterhouses are now banned from further purchases of cattle until they can put in place new measures to verify the origin of the livestock they buy. The beef producers and ranches have been fined a total of R$264.28 million (US$85 million) by IBAMA. JBS alone has been fined R$24.7 million (US$8 million).

JBS, which exports beef to over 150 countries, has denied wrongdoing and told Reporter Brasil, a news agency, that “the company does not buy livestock from ranches that practice illegal deforestation”. According to Reporter Brasil, JBS and other meat producers bought cattle directly from embargoed ranches and also through intermediary farms, where cattle of illegal origin was “laundered”. Eder Marquez, owner of one of the embargoed farms, confirmed to Repórter Brasil that he sold cattle to JBS.

IBAMA has revealed that laundering usually involves illegal ranches issuing transportation documents that make it look like the livestock sold to slaughterhouses comes from legal farms.

According to IBAMA, this practice should have been picked up by Para’s agricultural agency, Adepará. Leandro Aranha, an IBAMA agent in Para, told Reporter Brasil that “when Adepará says that there’s no cattle in [an embargoed area], but we find out that in fact there is […] then either Adepará is actively participating in laundering or it is concealing information about cattle ranching in embargoed areas”.

O Eco, a Brazilian environment news agency, alleges that the Brazilian federal government has attempted to cover up the situation by stopping IBAMA from releasing the information to the press. According to O Eco, such attempts fell short, as IBAMA had already informed journalists from Reporter Brasil and Globo about the investigation and its findings.

On Friday, 24 March, Heitor Moura Gomes, a federal judge in Para suspended IBAMA’s embargo of JBS’s slaughterhouses alleging that the purchase of illegal cattle was an exception to the company’s usual practices. Strangely, Folha de Sao Paulo, a Brazilian newspaper, quoted Moura Gomes as saying that JBS only bought 20,000 heads of cattle from embargoed areas, contradicting IBAMA’s findings.

Graphic demonstrating two methods for 'laundering' cattle from illegally deforested land. Courtesy of Repórter Brasil.

This is not the first time JBS has been accused of illegal practices. In 2015, it was revealed that the company had bought cattle from a rancher connected to large-scale illegal deforestation and fraud. The latest illegalities are contrary to the beef moratorium agreed by the major meat producers – among them JBS – in Brazil in 2009, when they committed to not sourcing livestock from illegally deforested areas.

Greenpeace has announced that it is suspending negotiations with JBS related to the implementation of the beef moratorium until the company can demonstrate that it is serious about combating illegal deforestation, slave labour and illegalities committed in indigenous reservations and protected areas. Greenpeace has denounced the lack of enforcement in Brazil, which allows such practices by the meat industry to persist.