Cerrado Programme 1

About the Cerrado Programme 1

Announced in August 2022, the Cerrado Programme 1 provides financial incentives to farmers that meet its Eligibility Criteria with a focus on the protection of native vegetation in addition to legal requirements.

To be eligible for the Programme, farmers must follow the Forest Code, have an unquestionable right to use the land, and demonstrate that they and their farms do not contravene environmental or legal requirements. Alongside this, the cultivation area to be financed must have been cleared before 1 January 2020 and must have native vegetation in excess of the levels required by the Forest Code for Legal Reserves and Areas of Permanent Protection (APPs).

This first phase of the programme was designed to demonstrate this approach and provide the basis for scaling it up to protect vast tracts of native Cerrado vegetation in Brazil (see Annual Report Year 1). As of September 2023, the RCF attracted additional investors (Rabobank, Santander, and AGRI 3), and significantly scaled up its operations.

Implementation of the programme reduces conversion of Cerrado habitats, conserves carbon stocks and biodiversity and supports the production of deforestation and conversion-free soy.

Impacts of the RCF are monitored by SIM and independent monitoring is conducted by EarthDaily (see monitoring methodologies here).

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Expected Impact

The Cerrado Programme 1 is expected to generate the following impacts, over a four year period:

Soy

1 million tonnes of deforestation- and conversion-free soy produced.

Conservation

150,000 ha of native vegetation conserved, including 30,000 ha of Excess Native Vegetation that could, otherwise, be legally deforested

Carbon

20 million tonnes of CO2e stored in forests maintained by the programme

Financial Supporters

The Cerrado Programme 1 has the financial support of the following companies:

Programme 1 sponsors:

Blended Finance support:

Structuring and management team

The Cerrado Programme 1 was structured by the following organisations:

Eligibility Criteria for Cerrado Programme 1

The following eligibility criteria are required for participation in the Responsible Commodities Facility for Cerrado Programme 1 (see full description here):

Land use

The area of cultivation must not have had any deforestation and conversion of native vegetation since 1 Jan 2020*. Preference will be given to areas converted from abandoned pasture land to soy cultivation after 2008.

Forest Code Compliance

Farm land must be registered with the Cadastro Ambiental Rural (CAR). The farm must contain and maintain areas of native vegetation equivalent to those required for Legal Reserve and Areas of Permanent Protection (APPs) determined by the Forest code or have formally adhered to a Programme of Environmental Regularization (PRA) established by the state environmental agency**. The farm area must not overlap with public protected areas, indigenous lands and other traditional people and community lands (including ‘quilombolas territories’).

Land title

Farmers must have unquestionable right to use the land, be it as land title, land lease agreement, or another legally recognised form of land tenure (e.g., ‘posse’)

Legal Compliance

Farmers must demonstrate that they and their farms do not contravene any environmental or legal requirements, such as embargoes, environmental irregularities, contraventions of the labour legislation (including slave and child labour), non-compliance with the Soy Moratorium (if applicable), and internationally-accepted rules for the use of agrochemicals.

*Farmers occasionally request the conversion of small areas of native vegetation to conduct farm improvements (building storage areas, water reservoirs, etc.). Provided that these areas are small and not for the purpose of expansion of the agricultural area, RCF analyses and considers them eligible. In order to do so, RCF uses the concept of Minimal Level (of deforestation or conversion) as defined by the Accountability Framework Initiative Terms and Definitions, which states “To be considered consistent with no-deforestation or no-conversion commitments, minimal levels must generally meet the following conditions: Not exceed cumulative thresholds that are small both in absolute terms (e.g., no more than a few hectares) and relative to the area in question (e.g., no more than a small proportion of the site).”

**The RCF analyses Forest Code compliance by looking at single farms (defined as the area covered by a CAR) or bundles of individual CARs that, in combination, result in the desired area of native vegetation put under the protective status of the RCF.  This bundling should not be understood as a means of compliance with the Forest Code requirements and is not intended to release the farmer of the regularization process committed under the Forest Code rules (enrolment in the CAR, engagement in a PRA, etc.). In order to differentiate its metrics from those of the Forest Code, the RCF refers to areas of Excess Native Vegetation (ENV) as opposed to Excess Legal Reserve, to avoid confusion with areas legally categorised under the Forest Code.