Home to more than 224 million heads of cattle , Brazil is the largest beef exporter in the world. Of course, despite its economic importance to the country, cattle is practically synonymous with deforestation and greenhouse gas emissions, and Brazilian cattle ranching as a sector struggles with productivity and the integration of technology that could make processes more sustainable.

As the climate change agenda goes more mainstream, consumers and financial markets are increasingly aware of the importance of sustainable cattle ranching – an idea that many believe is unrealistic. Partnerships for Forests (P4F), a UK government funded program implemented by Palladium and Systemiq to accelerate initiatives that promote sustainable land use and economic development, has worked in Brazil since 2018, and has been trying to make sustainable beef a reality.

Livestock farming is currently the predominant commercial use of land in Brazil, covering an extensive area of 151 million hectares. In 2021 alone, the industry generated US$ 180 billion in revenue.

“Besides contributing almost 7% of the Brazilian GDP, the beef production chain faces important challenges, and deforestation is among the main ones – specifically illegal deforestation”, says Gustavo Palauro, Palladium Senior Investment Associate in Brazil and contributor to the report.

Common practices across the livestock sector in Brazil often lead to environmental degradation and biodiversity loss, both legal and illegal. Producers illegally occupy public lands to create pasture; water systems are affected by deforestation; and farming practices themselves are unsustainable. These challenges must be addressed as the sector strives to modernise and meet the demands of markets that value product quality, origin, and sustainability.

Over the past five years, the program has conducted a comprehensive sector analysis and developed guidance for programs and interventions. Through this process, P4F supported six livestock projects through to implementation, all of which have yielded tangible results and made a positive impact, by organising different stakeholders in the beef supply chain, and creating methodologies to measure carbon in cattle ranching production systems and monitoring tools.

To take it a step further and to better understand the state of cattle ranching today and any changes that have occurred since P4F’s launch in the country, the program recently commissioned and published a new study; Sustainability in the beef production chain – a roadmap for Brazil and lessons learned from P4F.

Conducted by Agroicone, the study provides a detailed description of the sector’s current state and future trends. It offers valuable insights for institutions and professionals who are dedicated to modernising livestock farming – enhancing sustainability and social inclusion and creating shared value. “Our latest data indicates that our work is responsible for some of the positive changes in the sector,” explains Marcio Sztutman, Palladium Director in Brazil. “This report is another contribution to further advancement that we hope to see in the sector, .”

The report also outlines seven key challenges facing the sector and proposes strategies to overcome each of them. “There is great potential for productivity increases in Brazil, reducing the pressure on clearing new areas and reducing greenhouse gas emissions,” adds Sztutman. “This potential productivity can generate substantial returns throughout the supply chain by supporting investments in sustainable practices on the ground, particularly among cattle ranchers.”

By adopting better practices, emissions fall and production increases, notes the report, suggesting that cattle ranching and sustainability could go hand-in-hand.

“The beef chain can and must continue to evolve in productivity and efficiency, generating income for rural farmers and landholders,” adds Palauro. “The outcome has to be better integration and organisation of the actors in the chain, with Brazil taking the lead and guiding the debate in favour of sustainability. Rural producers are a critical part of the conversation.”

For more, read ‘Sustainable Cattle Farming is Possible’, download P4F’s report, or contact info@thepalladiumgroup.com.