Brazil’s Lula has made progress on deforestation, but “agribusiness Is winning”

This story was originally published by Grist and is reproduced here as part of the Climate Desk collaboration.

When Brazilian president Luiz Inácio Lula da Silva took office in January 2023, he inherited environmental protection agencies in shambles and deforestation at a 15-year high. His predecessor, Jair Bolsonaro, had dismantled regulations and gutted institutions tasked with enforcing environmental laws. Lula set out to reverse these policies and to put Brazil on a path to end deforestation by 2030. 

Environmental protection agencies have been allowed to resume their work. Between January and November of 2023, the government issued 40 percent more infractions against illegal deforestation in the Amazon when compared to the same period in 2022, when Bolsonaro was still in office. Lula’s government has confiscated and destroyed heavy equipment used by illegal loggers and miners, and placed embargoes on production on illegally cleared land. Lula also reestablished the Amazon Fund, an international pool of money used to support conservation efforts in the rainforest. Just this week, at the G20 Summit, outgoing US President Joe Biden pledged $50 million to the fund.  

Indeed, almost two years into Lula’s administration, the upward trend in deforestation has been reversed. In 2023, deforestation rates fell by 62 percent in the Amazon and 12 percent in Brazil overall (though deforestation in the Cerrado, Brazil’s tropical savannas, increased). So far in 2024, deforestation in the Amazon has fallen by another 32 percent.      

Throughout this year, Brazilians also bore witness to the effects of climate change in a new way. In May, unprecedented floods in the south of the country impacted over 2 million people, displacing hundreds of thousands and leaving at least 183 dead. Other regions are now into their second year of extreme drought, which led to yet another intense wildfire season. In September, São Paulo and Brasília were shrouded in smoke coming from fires in the Amazon and the Cerrado.  

And yet, despite the government’s actions, environmental protections and Indigenous rights are still under threat. Lula is governing alongside the most pro-agribusiness congress in Brazilian history, which renders his ability to protect Brazil’s forests and Indigenous peoples in the long term severely constrained. 

“I do believe that the Lula administration really cares about climate change,” said Belen Fernandez Milmanda, Assistant Professor of Political Science and International Studies at Trinity College and author of Agrarian Elites and Democracy in Latin America. “But on the other side, part of their governing coalition is also the agribusiness, and so far I feel like the agribusiness is winning.”

Brazilian politics has always been fragmented, with weak parties. The current Chamber of Deputies, Brazil’s equivalent to the House of Representatives, is made up of politicians from 19 different parties. “It makes it really difficult to govern without some kind of coordination device,” said Fernandez Milmanda. Weak party cohesion makes it easier for interest groups to step into the vacuum and act as this coordination device. 

Agribusiness has long been one of the most powerful interest groups in Brazilian politics, but its influence has grown steadily over the past decade as the electorate shifted to the right and the sector developed more sophisticated strategies to affect politics. In Congress, agribusiness is represented by the bancada ruralista, or agrarian caucus, a well-organized, multi-party coalition of landowning and agribusiness-linked legislators that controls a majority in both houses of congress. Of the 513 representatives in the Chamber of Deputies, 290 are members of the agrarian caucus. In the senate, they make up 50 of 81 legislators. 

Today, the agrarian caucus is larger than any single party in the Brazilian legislature. “Members of the agrarian caucus vote together. They have high discipline and most Brazilian parties don’t,” said Fernandez Milmanda. “This gives them immense leverage towards any president.” 

Much of the coordination around the legislative agenda takes place away from congress, at the headquarters of Instituto Pensar Agropecuária, a think tank founded in 2011 and financed largely by major agribusiness corporations, including some in the US and the European Union. Among IPA’s main backers are Brazilian beef giant JBS, German pesticide producer BASF, and the US-based corporation Cargill, the world’s largest agribusiness. Core members of the agrarian caucus reportedly meet weekly at IPA headquarters in Brasilia’s embassy row to discuss the week’s legislative agenda. 

“IPA is really important because they are the ones doing all the work, all the technical work,” says Milmanda. “They are drafting the bills that they then give to the legislators, and the legislators will present it as their own.” 

The agrarian caucus has tallied several long-awaited victories in the current congress, which took office alongside Lula in January 2023. Late last year, they overhauled Brazil’s main law governing the use of pesticides. The new legislation, which Human Rights Watch called a “serious threat to the environment and the right to health,” removes barriers for previously banned substances and reduces the regulatory oversight of the health and environment agencies.

Instead, the Ministry of Agriculture, which has traditionally been led by a member of the agrarian caucus, now has the final say in determining which pesticides are cleared for use. Lula attempted to veto parts of the bill, but was overruled by congress. In the Brazilian system, an absolute majority in each chamber is enough to overrule a presidential veto.

Another recent victory for the agrarian caucus came as a major blow to Indigenous rights. Agribusiness has long been fighting in the courts for a legal theory called marco temporal (“time frame,” in English), which posits that Indigenous groups can only claim their traditional lands if they were occupying it in 1988, the year the current Brazilian constitution was drafted.

Opponents of the theory argue it disregards the fact that many Indigenous groups were expelled from their native lands long before that date. It has dire implications for the hundreds of Indigenous territories in Brazil currently awaiting demarcation, and could even impact territories that have already been recognized by law. 

The theory had been making its way through the Brazilian justice system for 16 years, until it was ruled unconstitutional by the Supreme Court last year. Blatantly flouting the court’s ruling, congress passed a bill codifying marco temporal into law. Lula tried to veto the bill, but he was overruled by the agrarian caucus again. The bill is currently being discussed in conciliation hearings overseen by the Supreme Court, which is tasked with figuring out how the new law will work in light of the court’s 2023 decision. The legal gray area in which many Indigenous groups occupying disputed lands now find themselves has contributed to a wave of attacks by land-grabbers and farmers in recent months. 

These are only two examples of legislation that are part of what environmentalists have come to call the “destruction package,” a group of at least 20 bills and three constitutional amendments currently proposed in congress that take aim at Indigenous rights and environmental protections. 

“The executive has to put a stop to this, because otherwise the tendency will be towards very serious setbacks,” said Suely Araújo, Public Policy Coordinator at Observatório do Clima, a coalition of climate-focused civil society organizations. 

But the government has limited tools at its disposal to block anti-environmental legislation. In the past, the executive branch had greater control over discretionary spending and was able to use this to its advantage while negotiating with congress. The past decade has seen a major power shift in Brazilian politics. Congress has managed through a series of legislative maneuvers to capture a significant portion of the federal budget, weakening the hand of the executive. 

Among projects which have a high likelihood of passing, according to analysis by Observatório do Clima, are bills that weaken Brazil’s Forest Code, the key piece of legislation governing the use and management of forests. “It would make control much more difficult because illegal forms of deforestation would become legal,” said Araújo. 

One such bill reduces the amount of land farmers in the Amazon must preserve within their property from 80 to 50 percent. The move could open almost 18 million hectares of forest to agricultural development, according to a recent analysis that the deforestation mapping organization MapBiomas conducted for the Brazilian magazine Piauí. That is an area roughly the size of New York state, New Jersey, and Massachusetts combined.

In a similar vein, another bill in the package removes protections for native grasslands, including large parts of the Cerrado and the Pantanal (the world’s largest tropical wetland). In theory this would affect 48 millions hectares of native vegetation. Yet another bill, which has already been approved in the Chamber of Deputies, overhauls the process of environmental licensing, essentially reducing it to a rubber stamp. “It does away with 40 years of environmental licensing in Brazil,” said Araújo. “You might as well not have licensing legislation.” 

Part of the reason many of these bills have a chance of passing is the Lula government’s limited leverage. With little support in congress and less control over the budget, bargaining with the agricultural caucus becomes a necessary tool to pass even legislation unrelated to the environment, such as economic reforms. During these negotiations, some environmentalists believe concerns over Brazil’s forests fall by the wayside. 

“Perhaps there is a lack of leadership from the president himself, with a stronger stance in response to the demands of the ruralistas,” said Araújo. “There are political agreements and negotiations that must be made. The bargaining chip cannot be environmental legislation.”