Brazil Court Upholds Laws That Doomed Amazon Soy Moratorium
The Supreme Court affirmed that the voluntary pact was constitutional but let stand state laws stripping tax breaks from farmers and traders who followed it.
Brazil's Supreme Court on Wednesday upheld state laws that deny tax incentives to farmers who complied with the country's soy moratorium, dealing a major blow to the future of an agreement that barred the purchase of soybeans grown on deforested Amazon land. At the same time, the court affirmed that the voluntary pact itself was constitutional.
Major grain traders withdrew from the moratorium in January, after top soy-producing states passed bills revoking tax benefits for participating companies.
Brazil is the world's largest soybean producer, accounting for about 40% of global output. Much of the crop is grown in central and northern states that include parts of the Amazon biome, such as Mato Grosso, Para and Rondonia. The country produced 171.5 million metric tons of soybeans in the 2024-25 season, according to the U.S. Department of Agriculture. China was the top export destination, according to Brazil's official trade data.
Launched in 2006 under pressure from environmental groups and international buyers, the moratorium was a voluntary commitment rather than law. Traders agreed — and the Brazilian government later endorsed — a ban on buying soy from Amazon land cleared after July 2008. Producers long argued the pact hurt business because it was stricter than national law, which requires farmers in the Amazon to preserve 80% of their land while allowing them to clear the rest.
A study published in July in the journal Science found the moratorium cut deforestation in risk areas by 35% in its first decade without hurting productivity. Its end could drive up to 1.4 million hectares (3.5 million acres) of deforestation over the next decade, the study said, leaving an area the size of Portugal exposed to legal clearing.
Greenpeace Brazil legal coordinator Angela Barbarulo called the recognition of the pact's constitutionality "enormously important" but said the ruling was undercut by its endorsement of state penalties. "There is an apparent contradiction," she said.
ABIOVE, the vegetable oil industry association, said the decision ends years of legal uncertainty, though it referred to the moratorium in the past tense. The Mato Grosso Soy Producers Association said the ruling reinforced states' authority and pledged to fight any future agreement reviving the restrictions.
This article was produced with the assistance of artificial intelligence (AI), in accordance with our editorial policy.
