Brazilian state seeks millions in environmental damages from giant meat packer

RIO DE JANEIRO – The Brazilian authorities are seeking millions of dollars in damages and fines from the world’s biggest meat packer, JBS, and three smaller slaughterhouses, according to court filings that accuse them of buying cattle raised on illegally deforested lands in the Amazon rainforest.

The lawsuits come as JBS is pursuing a listing on the New York Stock Exchange that would give the company expanded access to capital. They are expected to increase pressure on the company, which was recently the subject of a Senate hearing because of its supply chain’s links to deforestation. The United States is JBS’ largest market.

The 17 suits, brought by Rondonia state in Brazil’s west, say the companies have bought cattle raised in one of the Amazon’s most devastated protected areas, the Jaci Parana Extractive Reserve, which has lost 77 per cent of its forest cover since it was created in 1996. Dozens of members of the traditional communities there have left in fear of the land-grabbers and ranchers who have taken over most of the reserve.

JBS is the biggest purchaser of cattle from the Amazon rainforest, and experts say ranching is the biggest driver of deforestation there. Forest destruction, coupled with climate change, is already transforming humid ecosystems that store huge amounts of planet-warming gases into drier zones that instead release greenhouse gases into the atmosphere. The result is a double blow against efforts to combat climate change and biodiversity loss.

A New York Times investigation in 2021 found that leather from cattle raised in Jaci Parana had ended up on the seats of pickup trucks, sport utility vehicles and other vehicles sold by some of the world’s largest automakers. JBS was a key supplier of the leather. At the time, it disputed allegations that it had bought cattle raised on illegally deforested lands.

In a statement dated Dec 20, JBS said it runs a robust monitoring system in Brazil that covers an area three times the size of Britain to guarantee its suppliers do not occupy any areas illegally. “JBS is committed to a sustainable beef supply chain,” the company said.

Three of the 17 lawsuits, which were first reported by The Associated Press and Agencia Publica, are against JBS and a group of farmers who are accused of selling the company cattle raised on farms in the reserve. The other suits are against three smaller meat packers that are accused of buying hundreds of cattle raised in the reserve.

The Rondonia state authorities say farmers sold 227 cattle raised on about 405ha of illegally deforested land to JBS between 2019 and 2021. The state is seeking almost US$3.5 million (S$4.7 million) in damages from the company and the farmers. It is also imposing fines of more than US$400,000 on JBS, though those could be challenged in court. Attorneys for the state did not reply to a request for comment.

JBS has made some progress in compliance in recent years, after federal prosecutors in Para state filed lawsuits seeking environmental damages from a group of meat packers in 2009. Prosecutors did not win the case, but went on to establish a programme that audits cattle purchases.

An audit of JBS’ cattle purchases in Para found that 6 per cent had come from so-called irregular ranches, a steep drop from 2020, when an audit found that 32 per cent of animals had come from irregular sources. The same audit in Rondonia in 2023 found that 12 per cent of cattle purchases by JBS did not comply with the law.

Under the administration of President Luiz Inacio Lula da Silva, deforestation rates in the Brazilian part of the rainforest have fallen to a five-year low over the past 12 months.

“There are signs things are improving,” said Mr Paulo Barreto, a researcher who focuses on cattle ranching at Imazon, a non-profit research organisation based in the Brazilian city of Belem. But, he added, change was not coming fast enough.

Governments come and go, he said, so “this stronger commitment from companies is very important to signal to politicians that things won’t go back to the way they were before”.

Lawsuits that seek to hold meat packers responsible for deforestation are rare, Mr Barreto said. That is partly because purchases of cattle raised in illegally deforested lands are often hard to trace; they go through middlemen who present documents falsely attesting that the animals came from legal farms.

Mr Daniel Azeredo, a federal prosecutor who has been investigating cattle ranching for more than a decade, said the Rondonia lawsuits “strengthen the need for the country to improve traceability”. Without that, he added, “we will keep having the same problems”.

Rondonia judge Pedro Sillas Carvalho signalled doubts about the lawsuits brought by the state, according to one filing from last week. He wrote that the state attorneys needed to factor in the economic effects of their actions, because the exit of illegal farmers from the reserve could cause “loss of revenue”. NYTIMES