The Beijing-Brasília effect: Unlocking South-South cooperation for sustainable trade

A webinar hosted by Trase and the Tropical Forest Alliance in April convened nearly 270 international experts, policymakers and industry leaders to discuss recently published research on whether Brazil and China could reshape the sustainability of global commodity supply chains. The research is the result of more than two years of work by Trase, several research trips to China and Brazil, and consultation with more than 50 stakeholders in Brazil and China including high-level engagement with government officials.

The ‘Beijing-Brasília effect’ describes the outsized potential of China and Brazil to influence global progress on deforestation, climate change and food security due to the staggering scale of trade in agricultural commodities between the two countries, their record of environmental leadership in other areas, and the central role of deforestation and low-carbon agriculture in ensuring supply chain resilience.

The trade in beef, soy and other agricultural commodities between China and Brazil averages $47 billion annually. Brazil sends around half of its total agricultural commodities exports to China – a dramatic rise from just 6.5% at the turn of the millennium. One-third of China’s total agricultural commodities imports are now sourced from Brazil. Roughly 60% of China’s total soybean demand is met by Brazil alone.

André Vasconcelos, lead author of the report and head of global engagement at Trase, said that this deep interdependence exposes both nations to a shared systemic risk: the climate-driven erosion of food security and economic productivity. He cited evidence that recent droughts in Brazil’s southern states and the Amazon have already led to billions in losses and a 12% drop in Brazil’s agricultural GDP in early 2022.

A solvable problem

While at first glance addressing deforestation and carbon emissions embedded in supply chains seems very complex, Trase data shows that the problem is solvable, said Vasconcelos. The deforestation risk associated with Brazil-China’s trade of beef and soy is highly concentrated in a few regions of production, providing an opportunity for targeted action with an outsized positive impact. For example, while more than 1,500 Brazilian municipalities supply soy to China, just 73 account for 75% of the total deforestation risk.

In a challenging geopolitical landscape, Brasília and Beijing are stepping up to address global environmental issues. Both countries are playing leading roles in the low-carbon energy transition and have hosted recent global summits on climate change and biodiversity.

Speaking at the webinar, Dr Simone Bauch who leads the Special Advisory Office for Economics and Environment of Brazil, highlighted recent progress by the current administration in reducing Amazonian deforestation by more than half. Brazil is using public expenditure to take a lead in protecting its biomes. For example, its national agricultural finance plan, which deploys $100 billion annually, has begun blocking credit to farms flagged for having potentially illegal land clearing. In just one week of implementation, nearly 600 operations were blocked, representing over $100 million in withheld finance. Additionally, Brazil is fundraising for the Tropical Forest Forever Facility (TFFF) to create positive incentives for conservation.

Dr Wang Yi, a renowned professor of the Chinese Academy of Sciences said that, while some of the conclusions of Trase’s research require further validation, its recommendations are very constructive. He explained how China’s 15th five-year plan sets the framework for reducing fossil fuel consumption and carbon emissions while developing the energy system and sustainable production and consumption patterns. He said that green and low-carbon industries already account for 10% of China’s GDP and contribute more than 20% of new added GDP. Dr. Wang recognised the importance of food security and looked forward to exchanging ideas with partners in Brazil in areas such as satellite monitoring to improve product traceability.

Restoring degraded pasture

André Aquino from the World Bank Global Knowledge Center on Ecosystems Transitions, recommended that land intensification – making better use out of the agricultural land that Brazil already has – was key to preventing further agriculture-driven deforestation. Brazil has some 80 million hectares of degraded pasture that could be restored and put back into production. A recent joint agreement on land restoration between Brazil’s Ministry of Environment and China’s National Forest and Grassland Administration provides the basis for future technological and financial collaboration.

Dr Zhu Chunquan, director of Nature–Positive Research Centre and former head of China Nature Initiatives at the World Economic Forum, highlighted some of the challenges to implementing deforestation-free supply chains. Firstly, he highlighted a significant mismatch between cost and market incentives that might need consumers to pay a green premium to support verification and monitoring. Yet at the same time, awareness among Chinese consumers of the link between the products they buy, such as beef and soy, and deforestation is still quite low. Furthermore, while direct suppliers of beef are relatively easy to track, smaller, indirect suppliers are not, making traceability difficult for Chinese buyers.

Daniel Motta, sustainability manager for Latin America and commodity trader at COFCO International, said the company had secured over $1 billion in sustainability-linked loans that are linked to performance targets, including supply chain emissions reductions and certified volumes, for soy and corn. In 2025, COFCO signed an agreement to supply 1.5 million tonnes of certified deforestation-free soybeans to the Mengniu Group in China. Motta added that solutions for sustainable trade must work at farm level and take account of market constraints. He hoped that cooperation between Brazil and China would offer practical tools such as affordable traceability requirements, risk based monitoring and continuous improvement.

In line with the report’s findings, the webinar concluded that, by establishing government-led, data-driven standards for deforestation-free trade, Brazil and China have a critical role in influencing global market standards and enabling a resilient global food system.

Read Trase’s report: The Beijing-Brasília effect: A new paradigm for sustainable commodity trade?