While the just-concluded United Nations Climate Change Conference (COP30) in the Amazonian city of Belém may have achieved little in advancing our duty towards the planet, it has successfully brought attention to Brazil, its commitment to the environment and its on-ground actions. The attention had already shifted to the country when the Amazon Soy Moratorium (ASM) was suspended.
Under this sectoral agreement first implemented in 2006, commodity traders agreed to avoid purchasing soybeans from areas that were deforested after 2008. It was successful in this respect and soy-related deforestation declined from 30% in the pre-moratorium years to just 1% by 2013.
Over nearly two decades, the moratorium prevented around 18,000 square kilometres of Amazon deforestation, an area equivalent in size to the country of Portugal, while allowing Brazilian soy production to expand dramatically on previously cleared land. Brazilian soybean exports have quadrupled over the past 20 years, from 705 million bushels in 2004 to 3,744 million bushels in 2023.
The uncomfortable truth that remains is that the economic model driving this success may be approaching a point of diminishing returns, not just environmentally, but economically. At the heart of this dilemma lies a structural inefficiency often overlooked in climate and trade debates: soybean is a land-intensive oilseed with relatively low oil yield per hectare compared to other edible oil crops.
As a result, sustaining growth in soybean output requires continuous horizontal expansion rather than productivity gains, amplifying pressure on land and ecosystems. Even when expansion occurs on previously cleared land, the sheer scale required to maintain export momentum locks the economy into a model of rising ecological and economic costs.
Large-scale soy cultivation encourages mono cropping, heightens dependence on chemical inputs and increases vulnerability to pests, diseases and climate variability, significantly weakening long-term sustainability and farm-level resilience. The Amazon Soy Moratorium not only became the gold standard for zero-deforestation commitments worldwide, it also inspired similar agreements in other sectors.
Most importantly, it showed that environmental protection and agricultural expansion could coexist, providing a model for sustainable commodity production that protected critical ecosystems while maintaining global food security. Today, Brazil is losing the advantage gained over other countries. Deforestation linked to soy production is now accelerating the Brazilian Amazon’s decline. In 2024 alone, the region lost 954,126 hectares of primary forest, with fire hotspots pushing south into Mato Grosso’s expanding soy frontier. Over 70% of major Amazon fires are burning recently cleared areas. These major fires often escape into surrounding forests.
In 2024, fires directly affected 2.8 million hectares of primary forest, the highest on record. Although the government reported an 11% decline in annual deforestation for the year ending July 2025, reaching an 11-year low, the trend remains fragile. The sharp 92% spike in May 2025 and the 27% rise in the first half of 2025 signal that fresh clearing, much of it tied to soy, continues to fuel both deforestation and the fires that follow.
The loss of the Brazilian Amazon is also a massive economic challenge: the world’s largest rainforest generates ecosystem services worth hundreds of billions of dollars annually through rainfall regulation, carbon storage and biodiversity maintenance. This becomes graver if we consider the Amazon tipping point. Scientific modelling indicates that 20 to 25% deforestation combined with 4°C global warming could trigger an irreversible transition to degraded savanna ecosystems. In 2022, 13.2% of the original Amazon biome was lost, particularly in the eastern Amazon, where 31% of forest loss has occurred and crucial moisture cycles begin.
Research suggests that by 2050, between 10% and 47% of Amazonian forests will face compounding disturbances from rising temperatures, extreme droughts, deforestation and fires. Once crossed, this tipping point would impose massive externalised costs on Brazilian agriculture itself through altered rainfall patterns and reduced agricultural productivity. Ironically, soybean cultivation would be among the first agricultural systems to suffer from this disruption.
Highly sensitive to rainfall timing and prolonged dry spells, soybean yields decline sharply under climate stress, turning today’s expansion-driven gains into tomorrow’s productivity losses. Global demand dynamics amplify these pressures. China remains the dominant destination for Brazilian soy exports. It remains the most exposed market to deforestation from its soy imports, followed by Brazil’s domestic market and the European Union. This creates a classic principal-agent problem, i.e., importing nations benefit from cheap commodities while externalising deforestation costs to exporting nations and the global climate system.
The human dimension adds another layer of economic inefficiency. Indigenous communities achieve 83% lower deforestation rates while protecting lands that host the majority of native endangered terrestrial vertebrates and significantly higher carbon stocks than other conservation units. Yet in the Amazon, these communities suffer political underrepresentation, widespread violence, cultural erosion and land grabbing.
Research on the Brazilian Legal Amazon shows that indigenous territories receive up to 36% fewer socio-economic benefits than other protection types and land uses. With COP30 coming to an end, it leaves policymakers with the question whether short-term agricultural gains justify long-term economic and ecological losses. A truly rational economic model would internalise these costs and recognise that Brazil’s greatest comparative advantage may lie not in expanding soy production indefinitely, but in pioneering a sustainable agricultural model that preserves the natural capital upon which all future prosperity depends.
––Deepak Pareek, agriculture economist and technology strategist with over 27 years of global experience across 34 countries, working at the intersection of agriculture, technology, policy and economics.
