COFCO International and Mengniu Group sign MOU for first trade of ‘deforestation-free’ soybeans from Brazil to China
COFCO International and Modern Farming Group, a Mengniu Group subsidiary that produces milk and milk products, signed a Memorandum of Understanding (MOU) to supply and accept soybeans in line with the COFCO International Responsible Agriculture Standard certification programme. This deal, valued at more than $30 million, is the first soybean order in China with a clear “deforestation- and conversion-free (DCF)” clause, which indicates that the production of commodities does not cause a change to natural ecosystems.
The agreement, part of the World Economic Forum's Green Value Chain Taskforce, which brings businesses together to combat commodity-driven deforestation, will serve as a pilot project to create more resilience in the global agri-food industry, which accounts for more than one-third of global emissions, and advance mutually beneficial cooperation between producer and consumer countries. Soft commodities, such as soybeans, beef, palm oil, pulp and paper, are considered the main drivers of global deforestation.
The taskforce aims to increase the volume of DCF soybeans entering China; create a more sustainable value chain for soft commodities in China; deepen cooperation between China and producing countries; and promote sustainable agricultural land use and the protection of natural ecosystems in producing countries in the tropics.
“Today, more than ever, our industry must take action to help strengthen our food systems, promoting sustainable agricultural practices that protect our climate and environment, and helping to ensure a secure supply for affordable food for all while protecting farmer livelihoods,” said Wei Dong, Chief Executive Officer, COFCO International. “We congratulate and thank the Forum, TFA and the involved market players for convening the Taskforce on Green Value Chains for China and achieving the first milestones in the mainstreaming of sustainable soy supply to the Chinese market.”
“This year, Mengniu has made a commitment to achieve zero-deforestation for its entire industrial chain by 2030,” added Jeffery Lu Minfang, Chief Executive Officer, Mengniu Group. “As one of the first companies to join the Taskforce on Green Value Chains, we actively promote the purchase order of deforestation-free soybean by our subsidiary, Modern Farming Group, which has taken an important step to fulfil our commitment. Sustainable development only has milestones, no finish line. We hope to work with more partners to jointly achieve the goal of a green transition in the industry.”
“The Chinese market plays an important role in global agricultural commodity trade, and the Forum is delighted to facilitate this green purchase order as a leadership signal for the market,” said Liming Chen, Chair of Greater China, World Economic Forum. “It has great potential in driving more green economy opportunities and promoting international cooperation under the context of the global development initiative.”
“This purchase order for DCF soybeans is a milestone and sends a positive market signal from China to the global commodity market,” said Jack Hurd, Executive Director of the Tropical Forest Alliance, World Economic Forum. “We look forward to having more companies involved in similar actions to shape global agricultural commodities towards a more sustainable, resilient and responsible model.”
About Taskforce on Green Value Chains
Launched at the Forum’s Annual Meeting of the New Champions in June 2023, the taskforce encourages global supply chain actors that enter China’s market to alleviate deforestation caused by soybeans, palm oil, beef, pulp and paper and other commodities. Market leaders operating in China – Bunge, Cargill, China Mengniu Dairy, COFCO International, L’Oréal, Louis Dreyfus, McDonald’s China, Nestlé and Yihai Kerry – have joined the taskforce. The involved consumer goods companies generate a combined annual revenue of over 300 billion CNY within the China market, while the commodity traders account for over 80% of grain trade to the Chinese market.
About Tropical Forest Alliance
The Tropical Forest Alliance (TFA) is a multistakeholder platform, hosted by the World Economic Forum, that brings together business, government and civil society partners in the transition to deforestation-free supply chains for commodities such as palm oil, soy, cattle, pulp and paper. TFA has a network of more than 170 partners from over 40 countries, which identifies challenges and develops solutions, bringing together experts to transform ideas into effective actions in Latin America, Africa, China and South-East Asia.