INTRODUCTION

Growing demand for soy globally is resulting in a continuous expansion of the area under cultivation in Brazil. This expansion has been identified as a major driver of deforestation, resulting in destruction of natural habitats, loss of biodiversity and greenhouse gas (GHG) emissions. Efforts such as the Amazon Soy Moratorium have significantly reduced deforestation in the Amazon, but there is evidence that it has also resulted in leakage of deforestation activities to the Cerrado. The recently launched Cerrado Manifesto aims at preventing this trend and calls for "immediate action by companies that purchase soy and meat from within the biome, as well as by investors active in these sectors".

It is estimated that expansion of agriculture into Brazilian natural habitats results in the emissions of more than 1 billion tCO2e/yr, representing 51% of the national GHG emissions. While there is growing demand for land to expand agricultural production, it is widely recognised that the expansion of agricultural production can happen without further clearing of natural vegetation. It is estimated that more than 18 million hectares of cleared land, degraded or extensive pasture land, could be made available for more lucrative and productive agricultural uses such as soy.

In spite of the market signals and demand preferences for sustainability, trade and procurement challenges still need to be overcome to create efficiencies and enable this market segment to reach the scale required to meet demand and halt current environmental impacts.

The Responsible Commodities Facility coordinates a suite of activities to promote the production and trade of responsible commodities in Brazil, starting with soy and corn. We provide competitive credit lines for producers that meet our Eligibility Criteria. Among them, we create incentives for farmers that restore unproductive cleared lands.

The Facility will also operate a blockchain Registry to record the volumes and ownership of responsible commodities, enabling its traceability from farm of origin, and an Electronic Exchange to facilitate the commercialisation of these commodities. The combination of these measures would result in the growth of a new markets segment for Responsible Commodities, meeting international demand and the objectives of the Cerrado Manifesto and the various initiatives promoting its implementation.

HOW TO PARTICIPATE

Register you interest

Let us know that you are interested in crop financing by filling the form below.

Send the documents

Send us a set of documents to demonstrate that you meet the eligibility criteria of RCF.

Secure finance

Receive the crop finance needed to produce responsible commodities.

Eligibility Criteria

The following eligibility criteria are required for participation in the Responsible Commodities Facility:

Land use

Farm lands must be: (i) cleared of native vegetation before 2008; (ii) preference will be given to areas restored from abandoned pasture land to soy (and/or corn) cultivation after 2008; and (iii) no conversion of additional areas of native vegetation allowed after joining the Facility.

Forest code compliance

Farm land must be registered with the Cadastro Ambiental Rural (CAR). In case of deficit of native vegetation for legal reserve or Permanent Protection Areas (APPs), the farmer must commit to prepare a land restoration plan (PRADA) in conformance with the legal requirements of the state, during the course of the loan.

Land title

Farmers must have unquestionable right to use the land, be it as land title, land lease agreement or another legally recognised form of land tenure (e.g., ‘posse’).

Legal compliance

Farmers must demonstrate that they and their farms do not contravene any environmental or legal requirements, such as embargoes, environmental irregularities, contraventions of the labour legislation (including slave and child labour), and non-compliance with the Soy Moratorium (if applicable).

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Crop finance request

Information about the land

Name of the farm

Number of the CAR

Information about the producer

Name of the producer

CPF/CNPJ of the producer

Type of ownership

Name of the landowner

CPF/CNPJ of the landowner

Commodity to be sown