Supply Chain Management
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% Direct cattle suppliers monitored based on socio-environmental criteria
| 2019 | 2020 | 2021 | |
|---|---|---|---|
| Brazil | 100% | 100% | 100% |
| Paraguay | 55% | 75% | 100% |
| Colombia | - | - | - |
| Argentina | - | - | - |
| Uruguay | - | - | - |
Context
Minerva Foods is the only company in the sector to monitor its direct suppliers for cattle purchases in all Brazilian biomes in which it operates (Amazon, Cerrado, Pantanal and Atlantic Forest), through a geospatial monitoring system. Monitoring takes place in 100% of purchases made to verify the existence of illegal deforestation, invasion of indigenous lands, traditional communities or environmental protection areas and convictions for slave-like labor. Documentary verification is also carried out on the land tenure regularity of the property.
The Company is a pioneer in expanding the monitoring of the supply chain to operations in Paraguay, where illegal deforestation and slave-like labor are verified. In 2021, monitoring reached 100% of direct suppliers throughout Paraguay, meeting the goal of Minerva Foods’ commitment to sustainability.
For the other countries with operations in South America, the Company will implement the monitoring system by 2030, in accordance with the goals established in the commitment to sustainability.
% Compliance in Audits for Social-environmental Monitoring
| 2019 | 2020 | 2021 | |
|---|---|---|---|
| Audit of the Federal Public Ministry of Pará | 100% | 99,74% | 100% |
| Audit of the Livestock Farming Public Commitment | 100% | 100% | 100% |
| Independent Audit of Paraguay | - | 100% | 100% |
Context
In 2021, Minerva Foods achieved a 100% compliance rate in the third-party audit conducted by the Federal Public Prosecutor’s Office in Pará, the main and most reliable socioenvironmental verification body in the Brazilian production chain. Results showed that transactions made between January 2018 and June 2019, the evaluation period for the 2020 edition, totaled 113,520 animals purchased, with 100% originating from properties that operate in full compliance with all criteria of the Termo de Ajustamento de Conduta (TAC) for Livestock with the Federal Public Ministry.
As for the Cattle Raising Public Commitment, Minerva achieved, for another consecutive year, 100% compliance in the audit, fulfilling its criteria to combat zero illegal deforestation in the Amazon, overlaps with indigenous lands, conservation units, slave labor and Ibama embargoes.
In Paraguay, the Company also performs a third party audit following the guidelines aligned with the IFC (International Finance Corporation) for the monitoring of purchases in the country. The Company achieved a performance of 100% compliance with the social and environmental criteria.
Risk Analysis of Direct Cattle Suppliers
| 2019 | 2020 | 2021 | |
|---|---|---|---|
| Number of suppliers identified as having significant risk for the occurrence of labor analogous to slavery | 13 | 8 | 28 |
| Number of suppliers identified as having significant risk for the occurrence of environmental impacts | 2,400 | 154 | 374 |
Context
The Minerva Foods supply chain monitoring systems verify, at each purchase, the existence of environmental irregularities and conviction for slave-like labor. If any irregularity is found with local legislation or with social and environmental purchasing criteria, the action taken by the organization is to automatically and immediately block the supplier, i.e. the system prevents commercialization from taking place and ensures that purchases are made responsibly.
Participation of Direct Suppliers in the Low Carbon Emission Program
| 2019 | 2020 | 2021 | |
|---|---|---|---|
| Number of cattle suppliers participating in the Renove Program | - | - | 91 |
Context
The Renove Program, created in 2021, promotes collaborative action with the Minerva Foods cattle supply chain by implementing low carbon emission cattle farming. Developed in partnership with reference institutions, the program uses primary data and internationally recognized methodologies to ensure robustness and scientific credibility, thus contributing to recognition of the sustainability of South American livestock farming. In its first year, the program worked on three fronts, two of them dedicated to mapping the carbon balance on supplier ranch properties in South America, and the third front that aims to connect suppliers with environmental assets and the voluntary carbon market, green finance and training, in order to create incentives for the expansion of low carbon emission practices in livestock.
Slaughter by Division
| 2019 | 2020 | 2021 | |
|---|---|---|---|
| Total Heads of Cattle Slaughtered (thousands) | 3.548,20 | 3.173,60 | 3.572,30 |
| Brazilian Division (thousands) | 1.773,10 | 1.484,80 | 1.375,20 |
| Latam Division (thousands) | 1.775,10 | 1.688,80 | 2.197,10 |
Context
The year 2021 was impacted by market volatility and logistical restrictions in global chains. The geographic diversification strategy, one of the main pillars of Minerva Foods’ business model, continued to be essential in mitigating risks and maintaining profitability.
Slaughter by Type of Creation
| 2019 | 2020 | 2021 | |
|---|---|---|---|
| Total Heads of Cattle Slaughtered (thousands) | 3,548.20 | 3,173.60 | 3,572.30 |
| % of animals raised on pasture | 47,16 | 41,61 | 54,40 |
| % of animals raised in semi-confinement | 13,11 | 10,91 | 11,30 |
| % of animals raised in pasture confinement | 6,28 | 7,65 | 4,40 |
| % of animals raised in feedlot | 66,99 | 39,83 | 29,80 |
Context
Grazing is a predominant characteristic of ranching in South America. Semi-confinement and confinement on pasture are strategies for fattening and finishing, in which animals remain 100% of the period on pasture and receive additional nutrition (feed) at the trough. Semi-confinement or confinement diets are produced with grains or derivatives (mostly composed of corn, soy and mineral supplements). No animal by-products, growth hormones or similar are used for fattening and finishing.