Why are Brazilian soybean traders leaving the Amazon Soy Moratorium?

Traders are leaving the pact to retain tax benefits in Mato Grosso, as a new state law penalizes participation in environmental conservation agreements.

What is the Amazon Soy Moratorium and its impact?

The Amazon Soy Moratorium is a voluntary agreement to stop buying soybeans from deforested Amazon land, credited with saving millions of acres of rainforest over 18 years.

How does the new Mato Grosso law affect the soy moratorium?

The Mato Grosso law removes tax incentives for companies in the soy moratorium, incentivizing traders to withdraw from the environmental pact.

Home / Business and Economy / Brazil Traders Exit Forest Pact for Tax Breaks

Brazil Traders Exit Forest Pact for Tax Breaks

30 Dec, 2025

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Summary

Major soybean traders may abandon a two-decade Amazon protection pact.
A new Mato Grosso state law will remove tax incentives for participants.
The moratorium has saved millions of acres of rainforest over 18 years.

Brazil Traders Exit Forest Pact for Tax Breaks

Major global soybean trading firms are reportedly preparing to abandon the long-standing Amazon Soy Moratorium, a pact credited with preserving millions of acres of rainforest over the past two decades. This decision stems from a new law in Brazil's Mato Grosso state, set to take effect in January. The law will strip tax incentives from companies participating in the environmental agreement, prompting traders to prioritize financial benefits over conservation commitments.

The Amazon Soy Moratorium, established in 2006, has been a critical tool in slowing Amazon deforestation by preventing signatories from purchasing soybeans grown on land cleared after July 2008. However, Mato Grosso's new legislation represents a significant retreat from environmental pacts, driven by a desire to maintain tax benefits, which amounted to approximately 4.7 billion reais between 2019 and 2024. Critics warn this move sets a dangerous precedent amid a global climate emergency.