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Universidade de Lisboa - January, 2017

SUSTAINABILITY OF BRAZIL’S

SOY AGRIBUSINESS

Fabio Trigueirinho

Secretary General

Brazilian Vegetable Oil Industries Association

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ABIOVE, the Brazilian Vegetable Oil Industries Association, was founded on 1981 and has 13 members companies who are responsible for approximately 60 percent of Brazil's soybean processing and exporting volume.

Brazil is responsible for some 31 percent of the world's soybean production, with the estimate of a production of 101,7 million tonnes in the 2017 crop.

The soybean complex (beans, meal and oil) is one of the main items in the country's Trade Balance. In 2016 exports reached US$ 26 billion.

Europe is a major buyer of Brazilian soy protein (+14 million ton in 2015).

ABOUT ABIOVE

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1,0

00 t

on

Soybeans Corn 1st crop Corn 2nd crop

Source: Conab, 2016.

RECORD CROPS – SOY AND CORN

4Source: USDA, 2016.

1 250

1 750

2 250

2 750

3 250

Soy Yield (kilos/hectare)

Argentina Brazil China USA

STATE-OF-THE-ART TECHNOLOGY

40 years of research

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Crop

101.7

Crush

41.0

Meal

31.1 Domestic Consumption

15.7

Exports

15.5

Oil

8.1 Domestic Consumption

6.8

Exports

1.4

Soy Exports

58.0

Source: ABIOVE. Dec/2016.

2017 (in millions of tons)

Biodiesel

3.3

BRAZIL’S SOY SUPPLY AND DEMAND

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To contribute so that soybean farmers are in conformity with Brazil’s

Forest Code and, in this way, reconcile food production with environmental

conservation.

OUR MISSION - IMPROVE SUSTAINABILITY

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LAND USE AND OCCUPATION IN BRAZIL

519 million hectares of native vegetation (61%)

68 million hectares of productive acreage (8%)

96 million hectares urban areas (11%)

168 million hectares of pastures (20%)

Brazil: 851 million hectares

Source: MMA/IBGE, 2014

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AMAZON BIOME VEGETATION

- 420 million hectares (49% of Brazil)

- preserved native vegetation - 82%

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ALERT INSPECTION

LEGAL

DEFORESTATION

ILLEGAL

DEFORESTATION

DEFORESTATION

FARM IS

EMBARGOED

FINE

R$500/kg

purchased

THE FARM AND THE RURAL

PRODUCER ARE INCLUDED IN

IBAMA’S LIST OF EMBARGOED

AREAS IN BRAZIL

PUBLIC GOVERNANCE

LAW ENFORCEMENT

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IMPROVEMENT IN BRAZIL’S ENVIRONMENTAL GOVERNANCE

Governance Factors 2006 2016

Deforestation rate – Amazon Biome 14,286 km² 7,989 km²

Deforestation rate – Mato Grosso State 4,333 km² 1,508 km²

Environmental legislationProvisional Measure

Lack of legal security

Forest Code

Federal Law No. 12651/2012

Compliance with legislation Low High

Penalties for illegal deforestationWarnings and fines with

low collectionsEmbargoes of farms and high fines

Monitoring of environmental crimes Start-up of satellite useUse of satellite images in real time with

high definition

Field inspections IBAMA technicians

Inspections integrated with Federal

Police, Federal Highway Police, SEMAs

and National Security Force

Requirements for purchasing agricultural

productsNo requirements IBAMA’s Embargoed Areas List

Source: http://www.obt.inpe.br/prodes/prodes_1988_2014.htm

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SHARP FALL IN DEFORESTATION

Deforestation rate in the Amazon Biome

(in 1,000 hectares)

Source: INPE, 2016

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SOY MORATORIUM

Signed: July 24, 2006

Commitment: Signatories will not trade

soybeans produced in areas of the

Amazon Biome deforested after July

2008.

Soybeans are responsible for 1,1% of

Amazone Biome deforestation.

Monitoring 98% of the soybeans grown in the Amazon Biome since 2006

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PUBLIC RECOGNITION

“The Soy Moratorium and negotiations with the meat sector are programmes that could

serve as models for other countries”. Kumi Naidoo, Greenpeace Global Executive Director

“The soy industry is setting the example for respecting the forest and the consumers”.

Paulo Adário, Greenpeace Diretor

“We have delivered extraordinary results”. Frederico Machado, WWF Brasil - GTS member

The European Soy Customer Group - AHOLD, ASDA, Carrefour, Co-operative, Kraft, Marks &

Spencer, McDonald’s, Nutreco, Ritter-Sport, Sainsbury’s, Waitrose and Wal-Mart - “applauds

another year of positive progress by the Soy Task Force”.

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• Monitoring soybean in the Amazon Biome - transparency

• Contribution to sensibilize farmers to sustainability issues and Government toimprove environmental governance.

SOY MORATORIUM - 10 YEAR RESULTS

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Environmental legislation guarantees that

large areas of private land are preserved

Areas of

Permanent

Preservation

(APP): along the

margins of rivers

and hilltops

Legal Reserve (RL):

native vegetation

must be preserved

on 20% to 80%

depending on the

biome

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PRIORITY AGENDA:

CAR - RURAL ENVIRONMENTAL REGISTRATION

• Identification of the land owner and the area of the rural property: allowing

monitoring and control

• Survey of environmental assets and liabilities: environmental adequacy of

rural properties regarding Legal Reserves and Areas of Permanent

Preservation

• Definition of land use and occupation: reconciling environmental

conservation with food production

• Brings legal security to the producer

• http://www.car.gov.br/

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SUSTAINABILITY PROGRAMS - ABIOVE

Soja Plus: MT, MS, MG e BA: 6,8 million ton.

State Farms Soy area (ha)Soy production

(ton)

MT 763 1.686.108 5.058.324

MS 252 292.238 818.266

BA 130 325.946 638.340

MG* 63 80.000 240.000

Brazil 1.152 2.384.292 6.754.930*preliminary

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• 130 farms received 02 technical visits for

check-list application comprising 180

indicators

• 325,946 ha of soybeans verified

• 638,340 tons of soybeans

• € 300,000 of investments (2015-2017 )

Numbers of the program in Bahia State

IDH/ABIOVEIDH/ABIOVE COOPERATION

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1. Activity Unit Planned Done

1.1. Farms selection Farm 100 130

1.2. Check-list application / Technical recommendations Farm 100 130

1.3. Monitoring results and impacts Farm 100 130

1.4. Investments made by producers Farm 100 130

1.5. Workshops, Seminars and Lectures Event 7 7

1.6. Courses Event 17 19

1.7. Field days Event 4 6

1.8. Support for CAR and CEFIR registries Farm 20 25

1.9. Development of Sustainable Origin’s areas Workshop 2 5

1.10. Soja Plus Regional Award Event 2 2

Program Implementation - Bahia

IDH/ABIOVEIDH/ABIOVE COOPERATION

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Rural Constructions

Total A: € 263,103.80

Health and Safety

Total B: € 32,456.14

Socio-environmental

Total C: € 412,280.70

Total A+B+C

€ 707,840.64(62% above budget)

IDH/ABIOVE

Producers’ Investment - Bahia

Exchange rate € 3.42

IDH/ABIOVE COOPERATION

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• The economic complementarity of Brazil and Europe should be

taken advantage of, to their mutual benefit.

• Conformity with the Brazil Forest Code means reconcile food

production with environmental conservation.

• Soja Plus Program is an important vehicle to support the full

implementation of the Forest Code.

FINAL COMMENTS

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MEMBERS