Zero of 132 slaughterhouses have indirect-supplier control.

The Imaflora finding

In November 2024 Imaflora, Brazil's leading agricultural-supply-chain transparency NGO, published the results of a 132-slaughterhouse survey on monitoring practice for the previous 12-month period. Mongabay summarised the headline finding as: of 132 facilities surveyed, 8 demonstrated "high" direct-supplier (Tier-1) deforestation control, and 0 demonstrated control of indirect-supplier (Tier-2) deforestation exposure. AgTechNavigator's coverage of the JBS 2024 Sustainability Report sits in the same registry: voluntary commitments are publicly stated, operational delivery remains far from the public claim.

This is the substantive read on the state of the sector for deal teams underwriting in 2025–26.

The G4 Cattle Agreement, in brief

The G4 Cattle Agreement, originally signed in 2009 by JBS, Marfrig, Bertin and Minerva (Bertin was later acquired by JBS), is a voluntary commitment to monitor and exclude suppliers with illegal deforestation, slave labor, indigenous-land encroachment and conservation-unit overlaps. Coverage is the Amazon biome, not the Cerrado, and the G4 has not been formally updated to cover Tier-2 indirect suppliers, though the major packers have made individual commitments doing so.

The structural limitation of the G4 framework is the calf-fattening problem. A calf born on Farm A, raised on Farm B and fattened on Farm C before slaughter at Packer D triggers G4 monitoring only on Farm C (the direct supplier). The deforestation that occurred on Farm A or Farm B, typically 18–36 months earlier, is invisible to the packer's compliance system without an explicit Tier-2 reconstruction. This is the gap.

What the three majors actually publish

The disclosure profiles of the three major packers in 2024 disclosure cycle are as follows.

JBS. The 2024 Sustainability Report claims 100% monitoring of direct suppliers in the Amazon biome and a Transparent Livestock Farming Platform with approximately 62% of cattle processed enrolled on the blockchain-anchored monitoring system as of the prior 12 months. JBS publicly commits to 100% direct + indirect supplier coverage by end-2025 across the Amazon. The Cerrado biome commitments are weaker and less specifically time-bound. JBS has invested $43M in a mandatory animal-ID scheme for its Amazon supply.

Marfrig. The Verde+ Plan commits to full direct and indirect supplier traceability across all biomes by end-2025, five years earlier than the original 2030 target. Verde+ publicly reports having reincluded 3,561 farms since 2021. Marfrig is partnered with &Forest in a 6,000-hectare restoration project announced jointly with IDH.

Minerva. The VISPEC tool is the published indirect-supplier monitoring system; Minerva states a commitment to 100% direct + indirect Amazon coverage by end-2025 alongside the G4 framework. Chain Reaction Research's prior reporting documented operational gaps in VISPEC's coverage; no fully audited verification of the 100% claim has surfaced in the 2024 disclosure cycle.

What the three disclosures share is a pattern: aspirational targets, blockchain or proprietary-platform infrastructure as the implementation mechanism, and a 2025 milestone that is now passing without independently audited verification of full coverage. The voluntary architecture, even where genuinely well-intentioned, has not produced the operational delivery the deal-team underwriting needs.

What is actually binding now

Three regulatory mechanisms have moved into binding-constraint territory through 2024–25, none of them voluntary.

Mechanism 01, Brazil's federal 2032 beef-traceability mandate. Announced November 2024, Brazil's federal government committed to full beef-supply-chain traceability by 2032, with phased mandatory animal-ID infrastructure beginning earlier. The mandate is driven by China and EU buyer pressure, and is structurally similar to Argentina's earlier mandatory cattle-ID system. The implementation timeline is the substantive question; the policy direction is settled.

Mechanism 02, Banco Central deforestation-loan-conditionality (December 2025). Brazil's central bank introduced a protocol requiring lender-side deforestation due diligence on agricultural credit to high-risk biomes. Specifically, lenders extending credit to operators with Cerrado or Amazon cattle exposure must demonstrate due diligence including supply-chain reconstruction. This is the lender-side equivalent of the EUDR, applied domestically by Brazilian financial regulators rather than by EU import authorities. It changes the cost-of-capital for non-compliant operators.

Mechanism 03, EUDR Article 8 / Article 9, in force for EU-bound flows. EUDR enforcement on cattle and beef products has now passed initial implementation milestones; importer-side dossier requirements include geolocation and deforestation-free declarations back to the calf-birth farm. Tier-2 reconstruction is a substantive requirement, not a portfolio-overlay metric.

These three mechanisms produce the binding constraint. A 2026 cattle-deal underwrite that prices the indirect-supplier exposure off the JBS / Marfrig / Minerva voluntary claims is mis-pricing the regulatory risk.

What an underwrite actually needs

For a cattle-exposed deal, whether it sits in a farmland fund, a DFI environmental and social due-diligence pipeline, a parametric nature-based slip or a principal regenerative-cattle offtake, the underwriting question is not whether the packer has a Tier-2 commitment. It is what the asset's specific Tier-2 deforestation exposure looks like, calculated from primary-source data, against the relevant binding constraint (EUDR, Banco Central, or federal mandate).

Three concrete tests structure the substantive answer.

Test A, Tier-2 coverage on the specific perimeter. Not the packer's portfolio-level number. Not the regional average. The Tier-2 coverage measured against this asset's specific GTA (Guia de Trânsito Animal) movement footprint. A 14,200-hectare property in Mato Grosso has a specific bilateral pattern with 4–9 indirect-supplier farms; the Tier-2 coverage on those specific farms is the relevant figure.

Test B, Deforestation-event reconciliation on each indirect-supplier farm. For each Tier-2 farm identified, run the EUDR baseline reconstruction (forest cover at 31 December 2020) against the current state. Flag any change. Aggregate at the portfolio level.

Test C, Monitoring-covenant feasibility. Where Tier-2 coverage is incomplete, can a monitoring covenant be drafted that triggers off a specific Tier-2 farm's land-use change? If yes, the deal is underwritable with the covenant. If no, the gap is the deal-breaker.

How the GTA-customs reconciliation works

The Guia de Trânsito Animal (GTA) is Brazil's mandatory animal-movement permit, issued at the state level by animal-health authorities. The permit is the canonical record of which farm an animal was on before slaughter, but it is issued per movement, not per animal-lifetime. The chain typically breaks when a calf is born on Farm A, raised on Farm B, fattened on Farm C and slaughtered at Packer D.

Reconstructing the chain back to Farm A, the place where the deforestation actually happened, if it happened, requires reconciling sequential GTAs over a 24–36-month period. The reconciliation is mechanically straightforward where the GTAs are well-recorded; the operational complexity sits in (a) state-level data-access variation, (b) batch-vs-individual animal record granularity, and (c) the integration to downstream customs flows and shipping records (port AIS) for export-bound batches.

Five primary-source registries combine to support the reconstruction: the Cadastro Ambiental Rural (CAR, federal), the SICAR (state-level analogue, with state-specific implementation maturity), INCRA (the national land-reform registry), IBAMA's federal embargo list, and the state-level Ministério Público environmental registries (state prosecutorial records). Off-the-shelf vendors typically integrate two of the five; production-grade reconstruction requires the full five.

How Kyroq runs the reconstruction

Kyroq's chain-of-custody graph reconciles GTAs with downstream customs flows and shipping records (port AIS), integrated against the five primary-source registries. For a typical Mato Grosso cattle property, the agent surfaces Tier-2 coverage at 87–95%, substantially higher than the off-the-shelf vendor band, and lower than the packer's headline disclosure. That is the operationally accurate read.

Where the residual Tier-2 gap matters for the deal, the agent drafts a monitoring covenant, typically a parametric trigger off a specific Tier-2 farm's land-cover change, that the deal team can attach to the sustainability-linked loan or offtake contract. The covenant is verifiable, automatable and contractually clean. The cost of the work, end-to-end, is a fraction of the $640K consulting cycle that prior deal teams have had to fund manually.

The reading list

Imaflora · 2024 transparency review (referenced in Mongabay's November 2024 coverage).

Mongabay · "Brazil beef industry still struggling with deforestation from indirect suppliers, survey finds," November 2024. The substantive third-party read.

Mongabay · "Brazil to adopt full beef traceability by 2032 amid China, EU pressure," 2024. The federal-mandate announcement.

Mongabay · "In Brazil, a new label gives more visibility to deforestation-free beef," December 2025. The labelling layer.

JBS · 2024 Sustainability Report (full + executive summary).

AgTechNavigator · "Are JBS's sustainability commitments meaningless without more transparency?", October 2024.

Accountability Framework · "Beef on Track" case study on Imaflora's protocol.

Chain Reaction Research · "JBS, Marfrig, and Minerva: Material Financial Risk from Deforestation in Beef Supply Chains."

Marfrig · Verde+ Plan commitments page.

Fern · "Traceability for the EUDR: Lessons from the Brazilian cattle sector."

Trase · Brazil beef supply-chain data. Public dataset reference.

The substantive read for deal teams

Voluntary indirect-supplier monitoring in Brazilian cattle is dead. It has been dead since at least November 2024 when Imaflora's survey result became public. The only mechanisms that will actually deliver traceability before EUDR enforcement bites are the December 2025 Banco Central deforestation-loan-conditionality protocol and the federal 2032 mandate. Buying a JBS, Marfrig or Minerva sustainability pledge in 2026 is buying a regulatory bet, not a supply-chain control.

For deal teams, that means pricing cattle deals on the binding regulatory mechanisms, not on the voluntary disclosure layer. The work is to reconstruct Tier-2 exposure on the deal-specific perimeter, and to draft a monitoring covenant that triggers off primary-source data. Everything else is paperwork.