China has a huge appetite for soybeans: millions of tons per year, mainly for cooking oil and animal feed. Satisfying this demand has taken a heavy toll in recent years on the forests and fields of Brazil, China’s biggest supplier.
This is likely to get worse in the coming months, because China has practically stopped buying American soybeans, giving Brazilian farmers greater incentives to expand into new areas to grow the legume.
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Earlier this year, the government in Beijing slapped a heavy tariff on American soybeans in retaliation for heavy U.S. tariffs on Chinese goods. Until then, the United States had been China’s second largest supplier. But now farmers in the United States have sold nothing to China from this fall’s harvest.
Hopes for an aid package from the White House have been delayed due to the government shutdown.
Likewise Argentina, whose president, Javier Milei, met with President Donald Trump on Tuesday. Argentina sold a mountain of soybeans to China this year after American farmers were excluded.
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But no country has as much to gain as Brazil, the world’s largest soy exporter. It’s no surprise, then, that its powerful agricultural lobby is pushing to dismantle one of the most important industry-wide measures, known as the Soy Moratorium and designed to limit deforestation in Brazil’s most famous biome, the Amazon.
All of this is uncomfortable for Brazilian President Luiz Inácio Lula da Silva. He will host the next round of international climate talks in November in the Amazon city of Belém. His government has promised to control deforestation.
“The government is facing a very difficult situation,” said Cristiane Mazzetti, a forestry activist at Greenpeace Brazil, in an interview. “There is an attack on one of the most important mechanisms for zero deforestation.”
The accelerated growth of soybeans in Brazil
Soy is Brazil’s largest agricultural export. Its production has increased steadily in recent decades. But it has really accelerated in the last 10 years, as relations between Beijing and Washington soured, and China looked beyond the American Midwest for soybeans.
In 2017, at the beginning of Trump’s first term, Brazil had overtaken the United States as the world’s leading soybean producer.
Now, relations between Beijing and Washington have sunk to a new low, and American farmers risk losing their biggest global customer. For much of the past year, prices have been around $10 per bushel (equivalent to 27.2 kg), down from around $13 in early 2024.
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“We’ve had strong growth in recent years, starting with that first US-China trade war. And now, with the second one,” Lucas Costa Beber, vice president of Aprosoja, the Brazilian Association of Soy Producers, said this week. “In the long term, if this situation continues, opportunities for Brazil will increase.”
The prognosis for Brazil’s biosphere is less optimistic. Soybean plantations tend to appear on land that was previously deforested and cleared for livestock grazing.
Today, soybean plantations cover 40.5 million hectares, about 14% of the country’s agricultural land, according to MapBiomas, an independent group that uses satellite data.
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Most of this is in the cerrado, a vast region of tropical savanna and forest corridors that is less of a global celebrity than the Amazon but still a critical ecosystem for Brazil.
The threatened cerrado and the soybean moratorium
The Cerrado contains the sources of the country’s largest river basins, and it is vital for regulating rainfall patterns and temperatures. Deforestation decreased last year, as the Lula government intensified inspections.
But almost half of the cerrado’s native vegetation has disappeared, making way for cattle grazing and soybean plantations.
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“The cerrado is disappearing,” said Luciana Gatti, a climate change researcher at Brazil’s National Institute for Space Research. And now, she said, “the pressure to produce soybeans for export to China will be greater.”
In 2023 alone, soybeans were harvested from more than 445,000 hectares of recently deforested land in the Cerrado, according to Trase, a nonprofit group that tracks deforestation in agricultural supply chains. That’s an area larger than Rhode Island.
The cerrado is not part of the Amazon. Soy-related deforestation has not been eradicated entirely in the Amazon itself, independent researchers say, but it has been significantly slowed by the Soy Moratorium.
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Under this industry pact, which applies only in the Amazon region, the world’s top commodity traders have jointly agreed not to buy or finance soybeans grown on land that was deforested after 2008.
Partly as a result, in 2023, the Amazon soy harvest came from 150,000 hectares of recently deforested land, according to Trase figures, a much smaller area than in the cerrado.
Now, pressure is mounting to lift the Amazon Soy Moratorium. In August, Brazil’s national antitrust regulator briefly suspended it while the agency opened an investigation into alleged collusion among traders.
A federal court immediately reinstated the moratorium, but its future remains uncertain.
The soy producers’ association is leading the offensive against the moratorium. Lucas Beber, the group’s vice president, called it a “trade barrier disguised as environmental protection.”
He stated that the moratorium effectively favored other countries by regulating which Brazilian soybeans can be sold on the world market.
Lucas Beber said farmers could vastly expand soybean production in areas of the Cerrado that are currently pastureland. “All of these regions have degraded grasslands with the potential to be converted to agricultural land,” he said. “It really just depends on economic and market viability.”
The uncertain future of American farmers
Market viability for American soybean farmers is murky.
Soybeans are the US’s main agricultural export. The American Soybean Association said American farmers risk losing their top customer, China, which generated more than $12.6 billion last year, if the trade dispute continues.
Meanwhile, tariffs on China have increased fertilizer and equipment costs in the United States.
Trump has wavered wildly on whether he intends to meet Xi Jinping, the Chinese leader, at the end of the month at a trade summit in South Korea. If they meet, soybeans will certainly be on the agenda.
c.2025 The New York Times Company
