By Brazil Stock Guide – On September 30, Brazil’s antitrust authority CADE will rule on the future of the Amazon Soy Moratorium. The agreement, in place since 2006, bans the purchase of soybeans grown on land deforested in the Amazon after July 2008.
The pact was created when traders — including Cargill, Bunge (NYSE: BG), Archer Daniels Midland (NYSE: ADM) and Louis Dreyfus — faced boycotts in Europe. Greenpeace and other NGOs had exposed the link between soy expansion and deforestation. Major supermarkets threatened to drop Brazilian suppliers.
Abiove and Anec, the industry associations, responded with the moratorium. Brazil’s Environment Ministry, Ibama, INPE and Banco do Brasil later joined. In 2016, the agreement was renewed indefinitely, becoming part of Brazil’s climate policy.
Farmers Call It a Cartel, Traders Call It Credibility
Farm groups see the pact as a cartel. The National Confederation of Agriculture and Aprosoja in Mato Grosso argue that the traders, who dominate more than 80% of exports, are colluding to block farmers who follow Brazil’s Forest Code but not the stricter moratorium cut-off.
In August, CADE’s General Superintendence accepted the complaint. It imposed a preventive order suspending audits, compliance blacklists and public reports. It was the first time the watchdog had moved directly against the moratorium in its 17-year history.
Abiove and Anec appealed. They stressed that soy prices are set globally in Chicago, not in Brasília. They argued that companies exchange no sensitive commercial data, only environmental compliance information. For them, dismantling the pact would damage Brazil’s credibility abroad.
What’s at Stake for Brazil and Global Trade
A federal judge in Brasília suspended CADE’s order, citing reputational harm and daily fines. But the tribunal will now issue the final word.
Brazil is the world’s largest soybean exporter, supplying nearly half of global trade. The ruling could ripple through commodity markets, shaping flows to China, Europe and the U.S. Traders fear buyers may impose restrictions if the pact collapses. Farmers argue the opposite: that the pact already costs them access to markets at home.
Government agencies back the moratorium. The Environment Ministry calls it part of national climate policy. Ibama and INPE provide data that make monitoring possible. Prosecutors highlight evidence that less than 5% of soy expansion since 2008 has come at the expense of primary forest.
The Supreme Court has also weighed in. Justice Flávio Dino noted the pact’s importance for Brazil’s reputation but said adherence must remain voluntary and could be renegotiated.
For traders like Cargill, Bunge (BG), ADM (ADM) and Louis Dreyfus, CADE’s ruling will determine whether they can still assure buyers that their supply chains are deforestation-free. For producers, it could reset the rules of access to international markets. For Brazil, it will show whether the country can remain an agricultural powerhouse while keeping its climate promises.
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