Two decades of investigative reporting: How they exposed the ‘cattle laundering’ scandals of Brazilian meat firms

Foodthink’s Take

21 March is the International Day of Forests, with this year’s theme being ‘Forests: A Precious Source of Food’. Yet, on the other side of the world, the Brazilian beef industry continues to expand at the cost of destroying forests and biodiversity. In the face of international calls to halt deforestation, meat giants have long denied responsibility, shifting the blame to downstream ranches in the supply chain. However, a group of Brazilian investigators has uncovered the truth behind this systemic deforestation. This echoes the transnational supply chain revealed in a popular article funded by Foodthink, ‘Fake Meat’ Displaces Real Meat: Tables, Herders, and the Amazon: imported frozen meat that impacts the livelihoods of herders on the Tibetan Plateau includes beef produced through deforestation, incurring a severe environmental cost. We take this opportunity to invite our readers to reflect on what truly constitutes an environmentally friendly method of food production.

● The tinned beef supply chain from Brazil to Europe and the US. Source: Repórter Brasil report

An inspection stamp from the Brazilian Ministry of Agriculture, accompanied by an export tracking code over 20 digits long, indicates that this tin of beef was imported from Brazil.

This ordinary tin, available at budget supermarket chains such as Sainsbury’s in the UK or Albert Heijn in the Netherlands, became a key piece of evidence for the environmental organisation Repórter Brasil in its investigation into JBS, Brazil’s largest meat processor, and the sale of illegally deforested beef.

As the world’s largest beef exporter, Brazil has a livestock population of over 200 million head, 40% of which come from the biodiversity-rich Amazon region.

Driven by Brazilian government policies encouraging agricultural and livestock development, this massive carbon sink—known as ‘the lungs of the planet’—has been continuously eroded by deforestation, transformed into ranches and farmland for feed soybeans. In the first two decades of the 21st century, deforested areas in the Brazilian Amazon reached 44 million hectares. Slash-and-burn deforestation provided low-cost pasture and feed resources for livestock, establishing the cost advantage of the Brazilian beef industry.

Faced with this immense environmental toll, the Brazilian government issued the Conduct Adjustment Term (TAC da Carne) for the meat supply chain in 2009, which strictly prohibited the sale of products from illegally deforested land.

But where there are rules, there are loopholes. When cattle from illegally deforested ranches are secretly transferred and registered at legal ranches, they become ‘legal’ products—a phenomenon known as ‘cattle laundering’.

Over the past decade, Repórter Brasil has developed a methodology for tracing cattle laundering. Its director, Marcel Gomes, was awarded the 2024 Goldman Environmental Prize for his work, lifting a corner of the veil over the controversy surrounding deforestation in Brazil.

● Marcel being interviewed for the Goldman Environmental Prize.

I.Cattle Laundering: A Supply Chain Conspiracy

The Brazilian meat supply chain can be broken down into six stages: breeding, rearing, fattening, direct suppliers, slaughtering, and processing. These complex upstream and downstream relationships provide fertile ground for ‘cattle laundering’.

● Diagram of the Brazilian beef supply chain hierarchy. Source: GEI

Dominant firms such as JBS, Marfrig, and Minerva maintain a tight grip on the slaughterhouses and meat processing plants upstream, sourcing cattle through lower-tier suppliers.

However, many ranches do not supply these firms directly; they are only responsible for the ‘frame-growing’ stage after calves leave the nursery (where the animals primarily grow their skeletal structure rather than adding fat). These ‘skinny cattle’ are then sent to feedlots for fattening before final sale. It is often during this transport that ‘cattle laundering’ occurs.

‘Ranchers with family ties can transfer livestock freely without formal documentation,’ Marcel explained in an interview with Yale Environment 360. ‘Ranchers can also play numbers games, adjusting land boundaries to split a single ranch into ‘legal’ and ‘illegal’ zones, using the legal status to launder livestock from the illegal areas.’

Although the Brazilian Animal Transport Guide stipulates that a transport permit (Guia de Trânsito Animal, GTA), including origin information, must be provided during transit, such data is not public.

Furthermore, the GTA only records information for a single transport leg and does not cover the entire supply chain. Consequently, it is impossible to determine if the cattle came from different ranches, let alone track whether they originated from illegally deforested areas.

The multiple transfers of livestock and regulatory loopholes have become a shield for companies to refuse the traceability of ‘laundered’ cattle. Driven by environmental organisations such as Greenpeace, meat processing firms, led by JBS, have signed voluntary agreements including Zero Deforestation Agreements and the G4 Cattle Agreement, pledging not to source livestock from illegally deforested ranches.

However, JBS has consistently evaded its due diligence obligations. On more than one occasion, they have claimed they ‘can only trace back to direct suppliers’, leaving them ‘powerless’ against cattle laundering.

Repórter Brasil decided to take matters into their own hands to bridge the ‘last mile’ of the evidence chain and prove that traceability is possible. By combining satellite data, environmental fines, and public traceability records to locate the ranches and companies involved, and by conducting interviews and field investigations alongside unions and indigenous groups, they exposed these excuses.

II. Incapable of Tracing or Actively Laundering?

In July 2019, a truck bearing the JBS logo was prepared to depart with 250 head of cattle. The driver, Ale, inadvertently took a photo of the name of Ranch F and uploaded it to social media. Investigators from Repórter Brasil, the Bureau of Investigative Journalism (TBIJ), and The Guardian followed the trail and discovered that Ranch F was located at the southern edge of the Amazon rainforest. Its 1,455 hectares of land had been placed under an embargo by the government due to deforestation and fined 2.2 million reais (approximately 2.78 million yuan). The truck’s destination, S feedlot, was a direct supplier to JBS.

● A JBS truck and a deforested ranch captured in the same frame by driver Ale. Original source: Facebook

Moreover, the investigation revealed that JBS is not ‘incapable of tracing’; rather, it actively solicits cattle transport business from deforested ranches.

Firstly, Ale and his colleagues are JBS employees. Secondly, the transport route involves moving skinny cattle from Ranch F to S feedlot, and then transporting the fattened cattle to JBS’s own slaughterhouses. This so-called ‘three-legged journey’ has long been an open secret in the industry. The investigation found that JBS continues to promote the use of its own trucks for transport along this route.

It is estimated that between 2018 and 2019, at least 7,000 head of cattle from Ranch A were ‘laundered’ through the same route into the JBS supply chain, meaning thousands of tonnes of illegally deforested beef entered the market within a single year.

● ‘Cattle laundering’ route map: Repórter Brasil report.

This was not an isolated case. In 2022, facing another joint investigation led by Repórter Brasil and other agencies, JBS was forced to admit it had purchased 9,000 head of cattle from Charles Pozzebon, one of Brazil’s largest deforesters. Pozzebon and his family members, who were sentenced to 99 years in prison, deforested 2,844 hectares in the Amazon, then ‘laundered’ the cattle through legal ranches to supply JBS.

Marcel stated: ‘If these meat companies decided to cut out the grey areas of their supply chains, they would lose a significant portion of their market share. This is why they actively choose not to monitor the entire supply chain.’ It could be argued that without ‘cattle laundering’, JBS’s annual revenue would not reach 78 billion US dollars.

There is currently no precise estimate of the proportion of ‘laundered’ cattle in JBS’s meat production. According to satellite data analysis by the research organisation Trase, between 2016 and 2020, deforestation and land conversion driven by Brazilian cattle ranching totalled 292,000 hectares—an area larger than Lake Taihu in China. JBS topped the list of deforested areas, increasing from 206,000 hectares in 2016 to 231,000 hectares in 2020, with its total exported beef exceeding one million tonnes.

● Beyond grazing, some deforested land is used for land speculation. In addition to the Amazon rainforest, the savannas of the Cerrado region are also hotspots for deforestation in Brazil. Source: Trase

These staggering figures imply that ‘cattle laundering’ is a core component of JBS’s business model. Without the efforts of environmental organisations like Repórter Brasil, most cases of cattle laundering would simply go unnoticed, and illegal deforestation would remain an unaddressed disaster.

III.‘From Table to Ranch’

This murky Brazilian beef is shipped in containers to every corner of the globe, with Asia, the Middle East, and Africa being the primary import regions. In 2019, the European Union imported 3 billion US dollars worth of beef from JBS, Marfrig, and Minerva—representing only 6.3% of Brazil’s total exports—yet it was here that the wave of resistance against illegally deforested beef first began.

In 2020, the international advocacy organisation Mighty Earth approached Repórter Brasil to launch a cross-ocean international campaign tackling both production and consumption regarding Brazilian beef exported to Europe.

● Traceability of retail giant Carrefour’s meat product supply chain. The red, blue, and orange markers represent slaughterhouses owned by JBS, Marfrig, and Minerva, respectively.

The two organisations recruited a research team from four European countries. They visited various supermarket chains in search of JBS meat products, photographing the Brazilian Ministry of Agriculture seals and export tracking numbers on the packaging.

Although the Brazilian government and the meat industry already have traceability systems in place—such as the Rural Environmental Registry (Cadastro Ambiental Rural, CAR) and animal transport permits—the data is generally incomplete, and self-reported information is difficult to verify. Marcel and his team invested significant effort into integrating fragmented public data to create the Cattle Tracker database, which is updated annually.

● The Cattle Tracker database developed by Repórter Brasil.

Using this system, Repórter Brasil uses export tracking numbers to trace meat products back through the packaging companies, processing plants, and slaughterhouses, eventually using satellite imaging to locate the specific cattle ranches. If a ranch involved has been sanctioned or fined for deforestation, they collaborate with local farm workers and indigenous people to conduct on-site verification. The rainforest is fraught with danger, as it is often controlled by illegal gangs. In June 2022, Dom Phillips, a British environmental journalist and long-time contributor to The Guardian, was murdered in the Amazon region. His indigenous guide, Bruno Pereira, was also killed; both were dedicated to protecting indigenous rights and the rainforest environment.

Following this tragedy, Marcel and his team ceased field investigations for a long time. Consequently, Repórter Brasil frequently expresses its gratitude to agricultural workers and indigenous people. They not only guide the research team in identifying ranches and mapping truck routes, but also help contact workers willing to expose the truth about forced labour and often protect the team from violent attacks.

IV. Pressuring the Retail End

● Mighty Earth publicly protesting JBS for condoning deforestation.

Meanwhile, Mighty Earth launched a wide-ranging consumer advocacy campaign across Europe. They publicly protested JBS’s environmental misconduct to raise consumers’ ecological awareness.

In 2021, Repórter Brasil published a research report titled ‘Cattle eating up the world’s largest rainforest’, revealing that major retail companies in Europe and the US were selling beef produced on deforested Brazilian ranches.

The report cited a study by market research firm YouGov and Mighty Earth, which found that 87% of surveyed UK consumers did not want their supermarkets to do business with companies destroying the Amazon rainforest, and 56% expressed a willingness to purchase ‘zero-deforestation’ products.

● Repórter Brasil’s landmark 2021 report: ‘Cattle eating up the world’s largest rainforest’. Source: Repórter Brasil official website.

As it turned out, pressuring retailers via the consumer end was an effective strategy.

In mid-2021, Marcel sent a draft of the report to all stakeholders in the supply chain—including JBS, supermarket chains, traders, and public health departments—demanding a response. Mighty Earth communicated directly with the supermarkets.

Unsurprisingly, JBS continued to deny any connection to the ‘cattle laundering’ ranches disclosed in the report. They claimed they would use blockchain innovation to improve traceability and asserted that they could eliminate illegal deforestation from the Amazon beef supply chain by 2025, and from all other Brazilian ecosystems by 2030. Marfrig and Minerva made similar pledges.

Repórter Brasil pointed out that if the ‘big three’, led by JBS, continue to rely on easily forged traceability data to monitor their direct suppliers, these promises are nothing more than empty words.

Felipe Nunes, an expert in data analysis and AI, also stated that Brazil does not need to create new mechanisms; instead, it should fully utilise existing public data to establish a comprehensive and transparent cross-referencing system to map and monitor the livestock supply chain more effectively.

● The Repórter Brasil team comparing satellite data.

After the report was officially released, six major supermarket chains, including Sainsbury’s in the UK, Carrefour in Belgium, and Auchan in France, announced a boycott of JBS beef imports. For the latter, this resulted in a loss of revenue in the millions of dollars.

Recently, the EU market has further raised the entry barriers for Brazilian beef products.

At the end of 2024, the EU Deforestation Regulation (EUDR) officially came into force. It stipulates that all companies trading in agricultural commodities (including leather, beef, and offal—all bovine products from Brazil) must legally prove that their products were not produced on land recently deforested.

● In October 2022, Repórter Brasil provided evidence for the world’s first climate lawsuit against a financial institution, accusing BNP Paribas of providing financing to meat companies linked to deforestation. Source: Screenshot from the Friends of the Earth website.

Will there be any significant improvement in the Brazilian meat industry over the next decade? Marcel isn’t holding out much hope. While European consumers have set a precedent by boycotting JBS, consumers in Brazil and the US remain indifferent. Ironically, while in California attending the Goldman Environmental Prize ceremony, Marcel still spotted JBS products on supermarket shelves.

Fast-food giants such as McDonald’s and Burger King have also claimed to be in dialogue with their meat suppliers, though no substantive progress has been made so far.

V.Beyond the ‘Cattle Laundering’ Controversy

Persistent illegal deforestation and ‘cattle laundering’ are but one facet of the scandals plaguing the Brazilian meat industry. Just four months ago, the European Union and the UK announced a suspension of beef imports from Brazil, citing the frequent detection of estradiol—a growth hormone banned in the EU. They have demanded that Brazil propose alternative solutions within 12 months and improve its existing beef certification and traceability systems to ensure compliance with European food safety standards.

Furthermore, labour rights violations within the meat industry have remained a focal point for *Repórter Brasil*. In July 2024, they partnered with the Centre for Research on Multinational Corporations (SOMO) to publish a research report exposing the appalling working conditions for slaughterhouse employees under JBS and Marfrig.

Across Brazil, over 137,000 workers are employed in slaughterhouse packaging. Not only are they subjected to excessively long hours and punishing production quotas, but 80% suffer from occupational diseases, and 40% have experienced workplace accidents involving cuts from knives, machinery, or the hooks used to hang livestock carcasses. Additionally, instances of forced labour and the seizure of indigenous lands are frequent.

● Labour rights report on the meat industry jointly published by SOMO and Repórter Brasil. Source: Repórter Brasil official website

Meanwhile, in China—the largest importer of Brazilian beef—attitudes toward these imports are also shifting.

In November last year, livestock associations from across China jointly submitted an application to the Ministry of Commerce, claiming that the high volume of low-priced imported beef has severely impacted the domestic beef cattle industry. They have requested that the Ministry implement safeguard measures to protect local producers. On 31 March, the Ministry of Commerce will hold a hearing to determine whether such trade measures will be adopted.

It is estimated that JBS’s beef exports account for 20-30% of China’s total imports, while Marfrig possesses the highest number of processing plants in South America approved for export to China. According to public records, JBS has also signed partnership agreements with JD Fresh and Hema, becoming a strategic supplier for both retail giants.

● Left: Brazilian beef brisket sold at a Hema supermarket in Beijing, produced by a Marfrig plant. Photo: Foodthink. Right: Frozen Brazilian beef from JBS in a butcher shop in the grazing regions of Qinghai. Photo: Wei Yiran & Pu Huaxi Ribu

In the first half of 2024, the average price of imported Brazilian beef was 36.81 yuan per jin, compared to 66.63 yuan per jin for domestic beef; consequently, the profit margin for the domestic beef cattle industry has plummeted to a precarious -11.74%. Behind these low prices, are there various hidden costs that have not been accounted for? If no one takes responsibility for the destruction of forests and costs continue to be externalised, the eventual chain reaction on the global environment could be immeasurable.

References

https://gijn.org/stories/investigating-cattle-laundering-deforestation-amazon-goldman-prize-2024/https://e360.yale.edu/features/marcel-gomes-interview