Why Beef Is the New Suv
How Americans' Ambition for Leather in Luxury SUVs Worsens Amazon Deforestation
An test of Brazil's immense tannery industry shows how hides from illegally deforested ranches can easily reach the global marketplace. In the United States, much of the need for Brazilian leather comes from automakers.
This article was produced in partnership with the Pulitzer Center'due south Rainforest Investigations Network.
BURITIS, Brazil — One morning this summer, Odilon Caetano Felipe, a rancher who raises cattle on illegally deforested land in the Amazon, met with a trader and signed over 72 newly fattened animals. With that stroke of the pen, Mr. Felipe gave his cattle a make clean record: Past selling them, he obscured their function in the destruction of the world'southward largest rainforest.
Over lunch shortly after the July xiv sale, Mr. Felipe spoke openly about the business that has made him wealthy. He acknowledged cut down the thick Amazon forest and that he had non paid for the state. He as well said he structured his sales to hide the true origins of his cattle by selling to a middleman, creating a paper trail falsely showing his animals as coming from a legal ranch. Other ranchers in the area do the same, he said.
"It makes no difference," he said, whether his farm is legal or not.
A New York Times investigation into Brazil'southward chop-chop expanding butchery manufacture — a business organization that sells non but beef to the globe, but tons of leather annually to major companies in the The states and elsewhere — has identified loopholes in its monitoring systems that allow hides from cattle kept on illegally deforested Amazon state to catamenia undetected through Brazil'south tanneries and on to buyers worldwide.
Mr. Felipe'southward ranch is ane of more than 600 that operate in an area of the Amazon known as Jaci-Paraná, a peculiarly protected ecology reserve where deforestation is restricted. And transactions like his are the linchpins of a circuitous global trade that links Amazon deforestation to a growing ambition in the United States for luxurious leather seats in pickup trucks, SUVs and other vehicles sold past some of the world's largest automakers, among them General Motors, Ford and Volkswagen.
A luxury vehicle can require a dozen or more hides, and suppliers in the United states increasingly buy their leather from Brazil. While the Amazon region is ane of the world's major providers of beef, increasingly to Asian nations, the global appetite for affordable leather likewise means that the hides of these millions of cattle supply a lucrative international leather market valued in the hundreds of billions of dollars annually.
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This leather trade shows how the wealthy world's shopping habits are tied to environmental degradation in developing nations, in this instance by helping to fund destruction of the Amazon despite its valuable biodiversity and the scientific consensus that protecting it would help to slow climate change.
To track the global trade in leather from illegal ranches in the Brazilian rainforest to the seats in American vehicles, The Times interviewed ranchers, traders, prosecutors and regulators in Brazil, and visited tanneries, ranches and other facilities. The Times spoke to participants at all levels of the illicit trade in the Jaci-Paraná Extractive Reserve, an area in Rondônia State that has been granted special protections considering it is home to communities of people who, for generations, have lived off the land by borer rubber trees.
These communities are at present beingness forced out past ranchers who want the land for cattle. Over the past decade, ranchers take significantly expanded their presence in the reserve, and today some 56 percent of it has been cleared, according to data compiled by the land environmental agency.
The reporting is also based on assay of corporate and international trade data in several countries and thousands of cattle-send certificates issued by the Brazilian government. The certificates were obtained by the Ecology Investigation Agency, an advocacy group in Washington. The Times independently verified the certificates and separately obtained thousands of additional ones.
This enabled the tracking of leather from illegal farms in the Amazon to slaughterhouses operated by Brazil's three biggest meatpackers, JBS, Marfrig and Minerva, and then to the tanneries they supply. JBS describes itself as the earth's largest leather processor.
According to Aidee Maria Moser, a retired prosecutor in Rondônia State who spent near ii decades fighting illegal ranching in the Jaci-Paraná reserve, the practice of selling animals reared in the reserve to middleman traders suggests an intent to conceal their origin. "It's a mode to give a veneer of legality to the cattle," she said, "and then slaughterhouses can deny in that location was anything illegal."
The problem isn't limited to Rondônia. Concluding month, an audit led by prosecutors in the neighboring state of Pará, home to the 2d-largest cattle herd in the Amazon, found that JBS had bought 301,000 animals, amounting to 32 percent of its purchases in the country, between January 2018 and June 2019 from farms that violated commitments to prevent illegal deforestation.
JBS disagreed with the criteria used past the prosecutors and agreed to improve its monitoring system, cake suppliers flagged by the inquiry and donate $900,000 to the state in response to the audit.
To go a sense of scale of the ranches operating in vulnerable areas across the Brazilian Amazon, The Times overlaid authorities maps of protected Amazon country, deforested areas and farm boundaries with the locations of ranches that JBS publicly listed as supplying its slaughterhouses in 2020. An assay showed that, among the JBS suppliers, ranches roofing an estimated two,500 square miles significantly overlapped Indigenous land, a conservation zone or an area that was deforested afterwards 2008, when laws regulating deforestation were put in place in Brazil.
The methodology and results were examined and verified by a team of contained researchers and academics who study state use in the Brazilian Amazon.
International trade data showed companies that own tanneries supplied with the hides had then shipped leather to factories in Mexico run by Lear, a major seat maker that supplies auto associates plants across the United States. Lear said in 2018 that it was then sourcing about 70 percent of its raw hides from Brazil. Brazil's hides likewise get to other countries including Italian republic, Vietnam and China for use in the automotive, fashion and furniture industries, the merchandise data showed.
JBS best-selling that virtually three-quarters of the ranches identified in The Times's analysis did overlap with country that the government categorizes as illegally deforested, or as Indigenous land or a conservation zone. Just it said all the ranches had been in compliance with rules to prevent deforestation when JBS bought from them.
JBS said that, in those instances where in that location were overlaps, the farms were immune to operate in protected or deforested areas, or their boundaries had changed, or they had followed rules to ready their ecology violations. Ranching is immune in some protected areas in Brazil if it follows sustainable practices.
In a statement, JBS said it has maintained a monitoring arrangement for more than a decade that verifies supplier compliance with its environmental policy. "More xiv,000 suppliers have been blocked for failure to comply with this policy," it said. However, the visitor said, "the bully challenge for JBS, and for the beef cattle supply concatenation in general, is to monitor the suppliers of its suppliers, since the visitor has no data about them."
Amazon deforestation has surged in recent years as ranchers race to supply growing demand for beefiness, specially in China. Leather industry representatives make the bespeak that as long as in that location is demand for beef, they are simply using hides that would otherwise be sent to landfills.
Raoni Rajão, who studies Amazon supply chains at the Federal University of Minas Gerais, said that because the leather industry makes ranching more profitable, information technology shares responsibleness for whatsoever deforestation. "Leather can have loftier added value," he said.
Wood loss is destroying the Amazon'southward ability to absorb carbon dioxide, which trees pull out of the air. Carbon dioxide from the burning of fossil fuels is the master driver of climate change. Brazil was 1 of more than 100 nations to pledge to end deforestation by 2030 at the recent United Nations climate tiptop in Glasgow.
While most ranches in the Amazon region aren't linked to illegal deforestation, the findings show how illegal leather is inbound the global supply chain, circumventing a system that slaughterhouses and leather companies themselves created in recent years to try to show that their cattle come just from legitimate ranches.
In response to detailed questions, JBS, Marfrig and Minerva said they weren't aware that cattle from the Jaci-Paraná reserve were entering their supply bondage.
All iii said they had systems to monitor farms that supply their slaughterhouses directly, and that they exclude farms that don't comply with environmental laws. Just all three best-selling that they can't trace indirect suppliers, such equally Mr. Felipe, who sell cattle through middlemen, masking their origins.
Lear said it used "a robust sourcing procedure" that ensured it worked "with the most capable and advanced suppliers that are committed to purchasing hides from cattle reared on compliant farms." The company said that if suppliers violated its policies, information technology would take steps that could include canceling their contracts "and/or legal action against the supplier."
G.M. said it expected suppliers to "comply with laws, regulations, and act in a way consistent with the principles and values" of the automaker. Ford said it aspired "to source only raw materials that are responsibly produced." Volkswagen said its suppliers already adhered to a high level of sustainability.
In Jaci-Paraná, the global demand for leather is helping to sustain a growing herd of 120,000 cattle where wood once stood. "If all the cattle were sold," said Ms. Moser, the former prosecutor, the government would have enough money "to reforest the whole reserve."
'I came hither to impale you'
Information technology was pouring rain last December when two men docked at Lourenço Durães' home by the Jaci-Paraná River. Mr. Durães, a 71-year-old safety tapper, invited the men in and offered them coffee. And then, later discussing the atmospheric condition for a few minutes, one of the visitors got right to the indicate.
"I won't fool y'all," he said, according to Mr. Durães and one of his friends, who together described the meeting recently. "I came here to kill you."
They wanted to go rid of Mr. Durães because his land is valuable to ranchers.
Jaci-Paraná was created in 1996 to grant a community of rubber-tree tappers the right to pursue their livelihood. Mr. Durães is among the last of the tappers. The community is existence pushed out by deforestation.
"We are frightened, but I hope for justice," Mr. Durães said, adding that he believed he was spared that mean solar day considering he is an sometime man.
According to Mr. Durães and a police force report filed by his friend, the would-exist hit man identified the person who had sent him, but only by a nickname. The constabulary didn't investigate, co-ordinate to the police force study, because Mr. Durães and his friend couldn't provide a full name of a person to press charges against.
In an interview, Lucilene Pedrosa, who directs the regional police division, said her team was waiting for the men to provide more information so it could investigate.
Regime data analyzed by The Times shows the ambition for land in the area. Co-ordinate to the numbers, between Jan 2018 and June 2021 ranches operating in Jaci-Paraná on illegally deforested land sold at least 17,700 cattle to intermediate ranches. The buyers were suppliers to the iii big meatpackers, JBS, Marfrig and Minerva, according to both government and corporate data.
Almost half of those 17,700 cattle were bought by Armando Castanheira Filho, a local trader who has been ane of the largest buyers in Jaci-Paraná and a direct supplier to all three major meatpackers. The sales to him created a paper trail that concealed that the cattle originated on illegal ranches.
A Times reporter witnessed such a transaction when Mr. Felipe, the rancher who acknowledged engaging in deforestation, sold his 72 cattle this year. The buyer that twenty-four hour period was Mr. Castanheira.
The Times and so tracked the animals. Eleven hours later, they ended up at a Marfrig abattoir.
Marfrig runs a website listing where its cattle come from in an effort to prove that it sources cattle responsibly. For the July 14 shipment tracked by The Times, Mr. Felipe's ranch isn't listed on the site. But the listing of farms that supplied cattle for the next twenty-four hours's slaughter does include Mr. Castanheira's farm, which is located exterior the reserve.
At the end of that day at the Marfrig slaughterhouse, a truck marked with the name of a tannery, Bluamerica, left the slaughterhouse carrying hides. Bluamerica is a tannery that supplies Lear, the motorcar seat maker.
Mr. Castanheira confirmed that some of the cattle he buys from the reserve go direct to slaughter, spending no fourth dimension at his ranch, although the paperwork shows they went through his ain farm beginning. He denied doing information technology to hide the cattle's origin.
"I don't practice this to 'wash' anything," he wrote in a text bulletin. He said his intent was merely to turn a profit from the departure betwixt what he pays for each animal and what he tin can get at the shambles.
Marfrig, Minerva and JBS said they did not acceleration trucks to pick up cattle at the Jaci-Paraná reserve, or whatever location other than their direct suppliers. Lawyers for Marfrig accept also filed a report with the police that lists the events described by The Times, calling them "potential offenses of criminal nature."
Mr. Castanheira now maintains that the Times reporter witnessed the only instance of this kind of transaction by him. All three meatpacking companies said they have now excluded Mr. Castanheira from their supplier puddle.
Two of Bluamerica's owners, companies named Viposa and Vancouros, said their suppliers were subject to regular audits and acknowledged the challenges of tracing indirect suppliers. Both companies said they were working with the World Broad Fund for Nature, an environmental group based in Switzerland, to improve their systems.
Overall, an assay of government data on cattle movement in Jaci-Paraná and nearby areas between 2018 and 2021 identified 124 transactions that show signs of cattle laundering, experts say. The transactions show at to the lowest degree five,600 cattle were transferred from farms in the reserve to middlemen who, on the same day, sold cattle to the iii major slaughterhouses.
Holly Gibbs, a Academy of Wisconsin-Madison geographer who has been researching agribusiness in the Amazon for a decade, said that though legitimate middlemen frequently buy and sell cattle on the same day, the fact that the transactions aren't closely tracked "is a huge loophole."
"They're bringing animals that were raised on a protected area into national and international supply bondage," she said.
The supply chain, from the ranch to the machine exhibit, is complex. Hides from Minerva and JBS slaughterhouses go to JBS-owned tanneries, while Marfrig's hides are mainly processed by Vancouros and Viposa, co-ordinate to corporate data and interviews. Trade data compiled by Panjiva, the supply-chain research unit at Due south&P Global Marketplace Intelligence, shows that the seat manufacturer Lear, which is based in Southfield, Mich., is the largest American buyer of hides from JBS, Vancouros and Viposa.
This past May, illegal ranchers in Jaci-Paraná won a major victory. Rondônia'southward governor signed into law a mensurate that shrank the size of the reserve past 90 percent.
The constabulary, which prosecutors are fighting in court, opens a path for ranchers on illegally deforested land to legalize their businesses. Critics of the law said it could set a precedent for farther deforestation in other protected reserves.
No thing the outcome of that legal fight, Mr. Durães, the rubber tapper, said he did not intend to leave his sliver of woods. The cattle pasture is now barely a mile abroad from his two-room wooden dwelling.
Living among the mighty trees is the simply existence he knows. And staying, he said, is "the only manner to keep the woods standing."
'Transparency' with a loophole
Every few seconds at the Vancouros tannery in southern Brazil, the sound of leather hides tumbling in dozens of 11-human foot wooden drums is interrupted by the clicks of a pneumatic marker as each private hide is pierced with a seven-digit code that traces its origin.
Clébio Marques, the tannery's commercial manager, plucked a damp blue hibernate from a pile, pulled out his phone and typed its code into a website that his company created for its clients, such as Lear. Upward popped the details of the supplier of that specific hibernate.
"All of our leather is traceable," he said. "This is not required, no i asked for it, but we felt the marketplace needed more than transparency."
Only so Mr. Marques was presented with the finding that ane of his most important suppliers, Marfrig, was buying cattle from suppliers whose transactions showed signs of cattle laundering. "I'm surprised," he said. "Nosotros await the master product to be legal."
He stressed, though, that his own company'southward monitoring wasn't at fault. "We have to trust the documents that are provided to usa, because our audit is based on their arrangement," Mr. Marques said.
All three major meatpackers have systems designed to track the last farm where the cattle they slaughter came from. However, all three have the same flaw: They don't business relationship for the fact that cattle don't typically spend their whole lives on a unmarried farm. Therefore, they don't consider that a direct supplier might exist selling cattle that were actually raised by someone else, on illegally deforested land.
The tracking systems were created after a 2009 Greenpeace report that linked Brazilian beef and leather suppliers to illegal deforestation. Today, the three major firms state that they have zero-tolerance deforestation policies for all direct suppliers.
All three major slaughterhouses publicly post their tracking data online. JBS's is the virtually detailed; the other companies omit ranches' precise locations. Information technology was the Times analysis of this JBS information for 2020, the most recent year available, that indicated the company'southward suppliers included ranches that may take violated government rules designed to prevent deforestation and displacement of Ethnic people.
JBS said all of its suppliers were in compliance at the fourth dimension of purchasing. Marfrig and Minerva said that they shared equally much information about their direct suppliers every bit permissible under Brazil's data privacy law.
Equally role of this process, tanneries rely on an industry-funded organization, the Leather Working Grouping, to certify their compliance. The group has assigned its superlative rating, "aureate," to all the Amazon-based tanneries that supply Lear with leather, signifying that they adhere to environmentally sustainable practices.
In a statement, the grouping said it was working to meliorate its traceability protocols but that "due the complication of the farming systems in Brazil and lack of publicly available databases, there is still, unfortunately, no easy solution for this state of affairs."
JBS, Marfrig and Minerva all have publicly pledged to better the tracking of ranches that sell cattle to its direct suppliers. JBS has said it will trace one layer of indirect suppliers by 2025. Marfrig vowed to trace all its indirect suppliers in the Amazon by 2025 and Minerva said it would have fully traceable supply chains in S America by 2030.
"Simply a nativity-to-slaughter traceability for individual animals is going to exist enough to ensure that at that place is no deforestation in these high-risk supply chains in the Amazon," said Rick Jacobsen of the Environmental Investigation Agency, the nonprofit group.
From Brazil to America's car lots
The leather seats in Cadillac's Escalade SUV, described past a dealer in Washington State as "a luxury hotel on wheels," can push button the price for General Motors' summit-of-the-line model to more than $100,000.
The Escalade is one of the many vehicles sold in the United States that uses leather seats and other trimmings from Lear, a company that commands about a fifth of the world'southward marketplace in machine seats.
Neither Lear nor Chiliad.Grand. labels where the leather for its car seats comes from. Lear'due south imports of Brazilian leather take surged over the past decade, driven past a jump in leather sourced from JBS, according to data from Panjiva, the supply-chain data visitor. Last twelvemonth, Lear was the largest American importer of leather and hides from Brazil, importing near 6,000 tons, the majority of that from JBS, co-ordinate to Panjiva data.
Total-size trucks and large SUVs are a growing forcefulness backside the demand for leather trimmings in the automobile industry. To many buyers, leather "screams luxury and usually adds significant resale value," said Drew Winter, a senior analyst at Wards Intelligence, an automotive research firm.
Raymond E. Scott, Lear'south chief executive, laid out the importance of luxury vehicles at an investor presentation in June. The visitor has 45 percent of the luxury market, he said. And what was propelling the growth in Lear's seating business was "really the strength of G.M.'due south full-size trucks and SUVs," a lineup that too includes the Yukon, Chevrolet Tahoe and Suburban.
In Brazil, "100 percent of our suppliers use geo-fencing" (a technology that uses GPS to establish a virtual contend) "to ensure they don't buy animals from farms involved with deforestation," Lear said in a 2018 statement.
However, The Times's findings in Brazil indicate that Lear'south suppliers didn't take the ability to track all cattle in this style.
Lear said it required all suppliers to comply with a no-deforestation policy, which bans the utilize of any materials sourced from illegally deforested areas or from Indigenous or other protected lands. According to corporate filings, Lear'southward other biggest customers are Ford, Daimler, Volkswagen and Stellantis, formed from the merger of Fiat Chrysler and the French maker of Peugeot and Citroën cars.
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Full general Motors said its supply concatenation was "built on strong, transparent and trusted relationships." Ford said information technology held itself and its suppliers to ambitious standards and "did well in many areas and can ameliorate in others." Volkswagen said it was working on better tracking the supply chain dorsum to the farm.
Daimler said that a small per centum of its leather came from Brazil. Stellantis said it shared concerns over traceability, and was actively working to confirm locations of tanneries and farms in its supply chain.
Concluding year, about i-third of the 15,000 tons of leather imported to the United States came from Brazil, which recently overtook Italy to go the biggest exporter of leather and hides to America. Much of that increase tin be attributed to the auto industry.
The bulk of JBS's leather shipments to Lear in the Us travels from São Paulo to Houston, according to trade data from Panjiva. From there, much of it is trucked across the Mexican edge to i of 2 dozen car-seat factories operated by Lear in Mexico, where workers cut the hides and stitch them into seat covers.
The leather is and so trucked back over the border. From January 2019 through June 2021, Lear's plants in Mexico shipped at least 1,800 tons of leather to the United States, according to trucking data tallied by Material Research.
Its final destination: Lear facilities nationwide. They tend to be located closer to the final automobile-assembly plants, making it easier for the visitor to match color and other variations to the models coming down the vehicle associates lines.
1 such destination is Full general Motors' plant in Arlington, Texas, a sprawling campus on 250 acres where the automaker produces some of the company's largest and most luxurious trucks, including the Escalade. Autoworkers gather about one,300 SUVs a day for sale in the The states as well as for export.
A ten-infinitesimal bulldoze abroad, Lear has a factory that makes leather seats.
Manuela Andreoni reported from the Jaci-Paraná reserve in Brazil. Hiroko Tabuchi and Albert Sun reported from New York.
Source: https://www.nytimes.com/2021/11/17/climate/leather-seats-cars-rainforest.html
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