Brazilian authorities suspend 20-year-old "soybean moratorium"

Brazil's antitrust authority CADE is suspending the "soy moratorium" that restricted purchases of soybeans grown on the site of deforested lands, which could soon increase soybean supplies.

 

Grain traders of the world's largest soybean exporter must stop the "soybean moratorium" program within 10 days, otherwise they face significant fines, Reuters reports.

 

A private agreement signed 20 years ago aimed to protect the Amazon rainforest and prohibited traders from buying soybeans from farmers grown on land cleared after July 2008. However, a Brazilian court ruled that the agreement potentially violated the country's competition law.

 

In its decision, the agency calls for a full investigation into the companies that voluntarily signed the "soy moratorium," including the world's leading grain processors ADM, Bunge, Cargill, Louis Dreyfus, and Cofco, since companies that wish to apply the moratorium criteria to imports of Amazon-grown products when purchasing soybeans must do so independently, in accordance with national legislation.

 

The Aprosoja Mato Grosso farmers' group called CADE's decision to suspend the program historic, as for years the private agreement, not legally binding, had created unfair trade barriers for farmers, making it difficult to sell crops grown in conventional and licensed areas.

 

Abiove, which represents oilseed processors, said it was "surprised" by the introduction of preventive measures and calls for a large-scale investigation, and would try to prove the legality of the moratorium agreement.

 

As already reported, Brazil increased soybean exports by 9% compared to last year to 12.3 million tons, of which 78% are supplied to China.

 

The new decision will facilitate the sowing of soybeans in areas cleared of forests that are now pastures. This will increase soybean and corn production and increase competition with products from the United States. It is worth noting that in the new season, American soybeans have already lost the Chinese market, as against the backdrop of Trump's tariffs and the trade war between the countries, Chinese importers have been buying almost no soybeans from the United States since the beginning of 2025.