U.S. Congress Democrats Aim to Address Palm Oil and Beef Trade in Deforestation Legislation, Reports Reuters

By Richard Cowan and Fathin Ungku

WASHINGTON/SINGAPORE – On Wednesday, Democrats in the U.S. Congress planned to introduce a bill aimed at combatting illegal deforestation globally by regulating the trade of specific agricultural products, including palm oil and cattle that are linked to such practices.

The proposed “FOREST Act of 2021” was put forth simultaneously in both the Senate and House of Representatives by Democratic Senator Brian Schatz and Representative Earl Blumenauer. This legislation could significantly affect trade from countries like Brazil and Indonesia, although it faces challenges in the highly polarized Congress.

The bill requires businesses to enhance their tracking of supply chains for certain items, particularly palm oil, cocoa, soy, cattle products, rubber, and wood pulp, ensuring they originate from areas free of illegal logging. Imports that do not meet these standards would be prohibited, and companies could face legal action and fines in the U.S.

“Deforestation is continuing to accelerate,” Schatz remarked in a phone interview, emphasizing the need for the U.S. to leverage its economic and political influence to reverse this trend.

The legislation is partially designed to serve as a template for other governments to tackle deforestation ahead of the upcoming U.N. climate conference in Glasgow. Experts estimate that deforestation contributes to approximately 10% of global greenhouse gas emissions.

“If deforestation were a country, it would rank as the third-largest emitter of greenhouse gases,” Schatz stated.

Despite Schatz’s role on a Senate climate change panel and Blumenauer’s leadership of a crucial House trade subcommittee, they have struggled to gain Republican support for the bill, which could hinder its progress, particularly in the Senate.

According to Schatz, no Republican senators have backed the measure. Meanwhile, only one Republican representative has shown support thus far, as noted by a Blumenauer aide.

Nonetheless, Schatz suggested that the bill, which is also framed as a means to promote fair trade, could foster an interesting political coalition.

“We aim to create a level playing field, as none of our commodities should be tied to illegal deforestation,” he explained.

There are currently no plans to incorporate the FOREST Act into the broader legislative package being negotiated by President Joe Biden, which includes significant investments in initiatives aimed at cutting carbon emissions linked to climate change.

Estimates suggest that nearly half of all tropical deforestation stems from illegal agricultural practices. Four commodities—beef, soy, palm oil, and wood products—are particularly responsible for driving this trend.

Blumenauer emphasized that the legislation will target regions at the highest risk of importing “inappropriately harvested products” into the United States and assist those countries in developing robust tracking systems through financial support and technical assistance.

Additionally, the bill aims to integrate deforestation into financial crime laws, enabling the U.S. to prosecute individuals funding criminal activity through the proceeds of deforestation.

“We have significant challenges in dealing with Brazil,” Blumenauer acknowledged, referring to the current government’s tough stance.

“There will eventually be a new administration in Brazil, but we cannot ignore the extensive deforestation occurring in the Amazon Basin in the meantime,” he added.