Risk factors

Deforestation and biodiversity loss

Livestock production is the single largest driver of habitat and forest loss. Cattle ranching and soy for animal feed are endangering forested areas like the Amazon, the continued loss of which could push us towards a tipping point that has enormous consequences through accelerated climate change.

Key stats

88
%
of meat and dairy companies, valued at $229 billion and with revenues of $160 billion, categorised as 'high risk'

Forest loss is incurred through direct land conversion: 80% of all agricultural land is used for grazing and to produce monocrops such as corn and soy for animal feed. Some of the world’s most biodiverse regions such as the Amazon and the Cerrado are at the centre of an aggressive agri-industrial expansion that threatens millions of native plant and animal species. In 2019, deforestation in the Amazon was up by 278% in just one year. Inputs into feed and animal agriculture, including fertilisers, pesticides and veterinary drugs, also degrade local ecosystems and water sources.

So far, supply chain interventions have not worked. Cargill, one of the world’s largest commodity traders, including soy for animal feed, has said it will not meet its 2020 commitment to eliminate deforestation. This is part of a broad industry trend: despite growing investment from companies, there is a lack of progress on halting deforestation due to rapidly growing demand for soy and beef.

We assess meat and dairy companies on their policies and supplier engagement to halt deforestation in two of the highest-risk supply chains: soy and cattle

We assess aquaculture companies on the extent to which their operations are certified, as well as their disclosure on feed conversion, disease outbreaks and ecosystem impacts.

Results

  • 88% of Asian companies – potentially some of the largest soy buyers from Brazil – have no discussion on deforestation risks. This includes the nine Chinese conglomerates that produce pork.
  • 5 European meat companies that source soy have limited to no disclosure on their soy sourcing. 88% of soy in the European Union (EU) goes towards animal feed, and 65% of this comes from Brazil and Argentina.
  • 10 pure aquaculture companies are fully certified or working towards full certification, indicating certification has become a core business requirement.