Blog >
Turning a Blind Eye on Brazilian Beef

Blog

Turning a Blind Eye on Brazilian Beef

tanya-khotin-bain-alum-new-york-ny

Tanya Khotin explains the true cost of beef that comes from Brazil. 

Deforestation is bad.

Deforestation in Brazil is especially bad, which is bad because most deforestation is happening in Brazil. 

And it’s happening primarily due to the industrial food and agriculture supply chains – beef, mainly, and soy embedded in all animal protein.

Not only are these global industrial food chains linked to deforestation, they’re also highly linked to global famine. At least half of all food is grown to feed animals, not people directly. And there’s high dependence on not only Brazil, but other rather volatile emerging markets, including Ukraine/Russia (through grains & fertilizer imported by Brazil to grow soy) and to China (Brazil is the major exporter of soy, and beef, to China). It’s no wonder that “friend -shoring” has become a thing not only in energy but also in food.

The industrial beef supply chain is also notoriously difficult and even dangerous to investigate, especially, you guessed it, in Brazil. This was getting better under Lula, and if trees could vote, he would win in a landslide on October 2nd. But since trees can’t vote, we hope that the polls are right and that human voters will give Lula the victory, in spite of Bolsonaro’s literal saber rattling.

Based on all above, it’s safe to suggest that if a company’s supply chain has substantial roots in Brazil, the company’s business is driving deforestation at some level. Question is, at what level does it matter?

How tight does the link between global food & ag brands and their purchasing of Brazilian beef and embedded soy need to be, for them or for their investors to be considered complicit?

Our friends at Profundo took their best shot at estimating operating and financial materiality for 10 companies that have significant inputs of soft commodities, specifically beef and soy from LatAm, that are leading branded producers, retailers and food franchises, and are publicly listed for max access to data.

As far as we know, this is the first such analysis in the market. And that’s no surprise – the research is itself a story of why industrial food supply chains are so challenging.

 

Key points include:

  • The industrial food and agriculture supply chains
  • The link between global food & ag brands
  • “The imperfection of our laws is compensated for by their non-observance.”

 

Read the full article, Where’s the (Brazilian) beef in downstream companies supply chains… and does it meat the materiality test?, on LinkedIn.