Why we do it
Addressing deforestation and conversion risks begins with a transparent and credible understanding of where farmers grow soy. By tracing soy to its farm origin and identifying links to deforestation, conversion, or other environmental and social risks, our members can target their efforts and measure progress toward eliminating soy-driven conversion and deforestation in the Cerrado.
Where we are
Deforestation- and conversion-free performance disclosure
2022 was marked by a historic milestone, when SCF members disclosed their individual performance on first-party verified DCF volumes sourced in 2021 across the 61 focus municipalities. This disclosure sets a new standard for transparency and accountability within the industry.
Building on the momentum of our December 2022 report, this year’s report presents the second round of DCF disclosures, following up on individual company DCF performance for soy sourced in the 61 focus municipalities. This report presents 2022 DCF data, whereas the 2022 report presented 2021 DCF data. To further ensure accuracy and reliability of our data, the SCF now uses third-party auditing for both direct and indirect suppliers, based on a shared SCF verification protocol.
DCF performance data is calculated according to the SCF’s methodology, which covers:
→ Direct and indirect soy sourcing;
→ Joint ventures of SCF members;
→ The application of a robust verification protocol.
| Total volume of verified DCF soy purchased from farms in 61 FMs | = % Verified DCF |
| Total volume of soy purchased from farms in 61 FMs (direct and indirect) |
Volumes sourced from indirect suppliers are counted as non-verified DCF when no farm-level traceability is possible as per the official methodology agreed by SCF members for reporting.
Note: The Methodologies & References section of this report offers further detail and insights into our DCF methodology.
Click on an SCF member logo to see all related data
Supply chain engagement: Accelerating the mobilization of indirect suppliers
Engaging indirect suppliers is vital for enhanced DCF performance. Soy resellers, cooperatives, warehouses, and trading entities represent the remaining key stakeholders to be engaged in achieving traceability and proving DCF soy sourcing. Their partnership and engagement will clarify the status of soy-driven deforestation and native vegetation conversion in the Cerrado and pinpoint supply chain risks most in need of interventions.
Understanding indirect suppliers’ current traceability practices provides insights for risk mitigation and collective action toward sustainable supply chains. To ensure the SCF’s commitment to DCF standards, the Monitoring Land Use team has established a three-step process for engaging indirect suppliers:
→ Building awareness among indirect suppliers of the SCF’s DCF objectives and steps for indirect supplier engagement;
→ Assessing indirect supplier capacity to set up traceability and monitoring systems based on a 3-rank maturity classification (A-C) developed in collaboration with the Instituto BioSistêmico (IBS), a third-party auditor; and
→ Co-developing action plans to build traceability and monitoring capacity.
Out of the indirect suppliers who underwent evaluation of their governance, social, and environmental risks, 69% presented a steady score and 31% presented an improved score.
On awareness-building, multiple training materials, including a handbook and a webinar series, have been developed to promote better practices on supply chain governance and management of sustainability risks.
→ So far, three webinars have been co-organized by ABIOVE and IBS in 2023, each dedicated to a thematic priority and each receiving broad participation from the soy sector (150+ indirect party representatives present at each session):
– A first webinar organized in July was dedicated to the presentation of traceability and socio-environmental criteria for soy sourcing;
– A second webinar took place in August to train indirect suppliers on tools and databases available for the evaluation of suppliers and rural properties;
– A third webinar was organized in September to discuss practical cases and address questions about traceability, socio-environmental criteria, and procedures.
→ To date, the SCF estimates that 35 indirect suppliers were mobilized via their participation in virtual workshops co-organized with ABIOVE and IBS.
In terms of capacity assessments, the SCF has successfully reached its engagement target of having 21 indirect suppliers classified according to a Class A, B or C maturity level (against an objective of 20). Of these 21, 3 indirect suppliers were selected as Class A indirect suppliers and are expected to have their traceability
data verified through third-party verification. Moreover, all indirect suppliers who had their score assessed have been engaged in the co-development of action plans. The SCF’s indirect supplier engagement process aligns with the growing global recognition of the urgent need to protect native ecosystems from commodity-driven deforestation and conversion. This is further bolstered by recent EU legislation for DCF verification and other upcoming legislations, providing a strong foundation for effective indirect supplier engagement.
What’s next
In 2024, the SCF will update its DCF reporting scope and methodological parameters.
By March 2024, an impact evaluation of the SCF’s indirect supplier engagement strategy will provide a foundation for the design of its next phase.
Box 1: Types of indirect suppliers
Soy Resellers are intermediaries who purchase soy from producers and then sell it to other entities in the supply chain. They often aggregate soy from multiple sources and play a role in transporting soy from farms to processing facilities.
Cooperatives are organizations formed by groups of farmers who pool their resources and collectively manage various aspects of soy production, including cultivation, processing, and marketing.
Warehouses are storage facilities for soybeans and related products. They can hold soybeans for extended periods, allowing for efficient logistics and distribution within the supply chain.
Trading Sources are entities involved in the buying and selling of soybeans and soy-related products. They often act as intermediaries or brokers who facilitate transactions between different supply chain stakeholders, including producers and processors.