Wedoany.com Report-Aug. 20, Brazil’s antitrust regulator, the Administrative Council for Economic Defense (CADE), has mandated that grain traders in Brazil, the world’s largest soybean exporter, suspend the “soy moratorium” program within 10 days or face significant fines, as reported by Reuters. Initiated two decades ago, the voluntary agreement aimed to protect the Amazon rainforest by prohibiting soybean purchases from farms cleared after July 2008.

CADE’s general superintendent, Alexandre Barreto de Souza, determined that the program may violate Brazil’s competition laws. He called for a thorough investigation into its signatories, including major global grain processors such as ADM, Bunge, Cargill, Louis Dreyfus, and Cofco. “Companies wishing to apply the soy moratorium criteria to buy soybeans grown in the Amazon must do so independently and in accordance with national laws,” de Souza stated.

The ruling has elicited mixed reactions. Aprosoja Mato Grosso, a farmers’ organization, hailed the suspension as a landmark decision. “For years, a private agreement, not backed by a legal framework, has created unfair trade barriers for farmers by preventing the sale of crops grown in regular and licensed areas,” the group said in a statement. The decision addresses farmers’ concerns about restrictions on legitimate agricultural activities.

The Brazilian Association of Vegetable Oil Industries (Abiove), representing oilseed processors, expressed surprise at CADE’s call for an investigation and preventive measures. “We were surprised by the recommendation for a full investigation and preventive measures,” Abiove stated, noting plans to demonstrate the moratorium’s compliance with legal standards.

Brazil’s soybean exports reached 12.3 million tonnes, up 9% from the previous year, with over 78% of the country’s soybeans supplied to international markets, supporting global agricultural trade. The CADE ruling requires the soy moratorium’s working group, including trade associations like Abiove and the National Association of Cereal Exporters (Anec), to halt coordinated compliance efforts and remove related online materials.

The investigation into the moratorium’s adherence to competition laws may take years. Meanwhile, companies can independently assess soybean purchases in line with national regulations, ensuring continued support for Brazil’s agricultural sector while addressing legal compliance.