World Bank’s IFC Withdraws $20m Loan From Controversial Brazilian Animal Feed Giant After Backlash – But An Even Bigger Brazil Investment Looms

TOCANTINS, BRAZIL –  The International Finance Corporation (IFC), the World Bank’s private-sector arm, has abandoned a US$20 million loan to Brazilian animal feed company Grupo Agronorte to finance an animal feed factory, following sustained opposition from the Apinajé Indigenous community and civil society organisations working with the Stop Financing Factory Farming (S3F) campaign.

However, even as the IFC backs away from the Agronorte loan, it is proposing a separate US$100 million investment in Agricola Alvorada, a Brazilian company involved in industrial-scale soy and corn production for animal feed and biofuels. The proposed investment raises similar concerns about the expansion of industrial agribusiness and its potential impacts on Indigenous Peoples, local communities and threatened ecosystems. The proposed investment in Alvorada underscores the need for the IFC to address these risks systematically rather than on a project-by-project basis.

The decision to withdraw from financing Agronorte comes after Indigenous leaders reunido in the Brazilian Amazon earlier this year to publicly call on the IFC to reject the loan. They pointed to the company’s founder and majority shareholder, Gilmar Gonçalves Carvalho, who for more than a decade has faced allegations of deforestation and land conflict on farms bordering Apinajé territory. 

Anterior accusations included a federal lawsuit brought by Brazil’s Federal Public Prosecutor’s Office alleging that roughly 2,000 hectares of forest were illegally cleared in 2013, which Apinajé leaders said was responsible for dwindling biodiversity, compromised traditional medicines, and polluted water springs.

“For many years, we have been fighting against Agronorte’s owner. The area he claims, which overlaps with our territory, is now completely deforested. We were deeply concerned that, if he obtained this funding, he would continue to deforest the area around our territory without consulting us. That is why it was so important for the IFC to stop this project.

“The Apinajé people mobilized — our chiefs, leaders and grassroots associations — together with Pyka Mex and Wyty Catë, to make sure this funding was not approved. The IFC’s decision was very important for us. But we know the fight does not stop here. They may seek other sources of funding, and we will continue to monitor what happens around our territory.”

— Apinajé Chief

“I want to thank the IFC for understanding the importance of this process and for withdrawing the funding. This decision is very important for the Timbira and Apinajé peoples. We only want to protect our territory and survive in it.

“Our greatest assets are the land, the water and the air. This territory is important not only for the Apinajé and Timbira peoples, but for the Cerrado and the Amazon. Having this funding removed is important because it does not empower this company to use those funds to finance conflict and deforestation.

“We will restore the areas that have already been deforested. The springs are concentrated there, so restoring this land is essential for the Apinajé people and for our survival in this territory.

“We also call on other banks and funders to pay attention to the proper processes and rules before financing projects like this. Do not finance projects that bring conflict and threats to our territories. We need the Cerrado, the Amazon, the air and the water to survive.”

— Representative, Association Wyty Catë

The community’s campaign was backed by the S3F coalition, which mobilized 109 organisations, collectives, social movements, researchers and activists, who escribió to the IFC earlier this year. The group warned that the proposed investment could contribute to environmental destruction and human rights violations, and that it would proceed without the free, prior and informed consent required under ILO Convention 169, ratified by Brazil in 2002.

The decision echoes a similar reversal in February 2022, when IDB Invest, the private sector arm of the Inter-American Development Bank, shelved a $200 million loan package to Brazilian beef producer Marfrig Global Foods after more than 275 organisations, mobilized by the S3F coalition, warned it would fuel deforestation and land grabbing in the Amazon. In this case too, the bank walked away after concluding it could not reconcile the loan with the company’s environmental record.

The move to cancel the loan marks an important precedent in the growing momentum against financing factory farming. According to a informe from S3F, the IFC approved 38 investments totalling around $2 billion in industrial meat, dairy and feed corporations between 2020 and 2025. Animal agriculture is responsible for around 19 per cent of greenhouse gas emissions globally.

Alessandro Ramazzotti, International Accountability Project researcher and S3F Steering Committee member, said, “This is a really significant development in the growing pushback against industrial livestock systems. Financing the expansion of feed production, particularly soy, can drive deforestation and land conflicts in places like Brazil’s fragile biomes. This decision evidences a widening recognition that development finance institutions cannot claim to be tackling poverty and climate change while bankrolling the industrial animal agriculture model that drives environmental degradation and social conflict. For years, these loans have moved forward on the basis that no one outside the boardroom was watching. That assumption is no longer safe.”

Carolina Galvani, Executive Director, Sinergia and S3F Steering Committee member, added, “While this is a huge win, and a testament to what the Apinajé leaders and their allies have achieved, this is only the beginning. Countless Indigenous communities around the world are facing the same threat from public and private finance flowing to industrial animal agriculture operators and global animal feed producers with unresolved land conflicts, and no meaningful consent process behind them. Left unchecked, feed production that supports factory farming’s expansion has devastating effects on forests, water sources, animals, and the communities who have protected the land for generations. Every bank watching this decision should take note.”

Contacto de prensa: Rose Hughes, di:ga Communications, [email protected] / +44 779 686 8540