The Power of the Pen: S3F letters make the case against MDB-funded factory farming projects

The livestock industry has emerged as a leading driver of global greenhouse gas (GHG) emissions: close to 20% by some estimates and more when considering indirect emissions from lost carbon absorption. Beyond fueling the climate crisis, widespread reliance on industrial livestock operations threatens public health, biodiversity, rural livelihoods, food sovereignty, and global food security. The scientific evidence is telling: to meet the targets of the Paris Climate Agreement, the Global Biodiversity Framework, and the Sustainable Development Goals (SDGs), a transition away from industrial agriculture is vital.

As agents for economic development, multilateral development banks (MDBs) have a stated imperative to promote sustainability through their financing decisions. Despite this, MDBs continue to invest billions of dollars in expanding industrial livestock operations.

The Stop Financing Factory Farming (S3F) campaign seeks to hold MDBs accountable, urging them to redirect their investments towards sustainable, ethical agroecological systems that integrate crops and livestock. Our campaign employs a multi-faceted strategy that includes movement building, narrative building, digital campaigns, and direct engagement with MDBs.

Our public letters, drafted in collaboration with local partner organizations and with hundreds of signatories, are a potent advocacy tool to mobilize public support and compel decision-makers to rethink their financing decisions. Each letter challenges MDBs to confront their misuse of taxpayer dollars given the profound social-ecological impacts of industrial livestock. We make clear why and how MDBs must align their investments with global sustainability goals.

Our mission is clear: to ensure that MDBs prioritize ethical and sustainable investments that contribute to a healthier, more equitable future. From safeguarding Brazil’s rainforests to addressing welfare issues in China’s urban pig farms, our letters have a global reach and impact. This overview highlights some of the most egregious projects we’ve opposed; for a comprehensive list of letters, visit the Resources page linked below.

Our Positions

This post highlights S3F campaign letters targeting five high-stakes projects:

1. Procesora Nacional de Alimentos C.A. (PRONACA) (April 2021 letter) – As illustrated in this 2021 letter, we urged IFC to reconsider support for the Pronaca Covid project, a USD 50 million investment aimed at expanding industrial pork and poultry farms in Ecuador. Pronaca has a notorious history of environmental violations, including pollution from its 115 industrial livestock farms, which has caused serious health and environmental damage to Indigenous communities, particularly in Santo Domingo de los Tsáchilas. Despite global efforts and a delayed vote, the IFC approved the loan in May 2021. Since then, groups such as CEDENMA and Friends of the Earth continue to monitor Pronaca’s harmful impacts and demand accountability, as the company’s expansion threatens further environmental and social damage across Ecuador.

2. Marfrig Global Pronaca AgroFoods (October 2021 letter) – We argued that the IDB Invest Board of Directors should reject a proposed $43 million loan to Marfrig Global Foods ($200 million syndicated), the world’s second-largest beef company, due to its significant environmental and social impacts. Funding Marfrig contradicts the SDGs and the goals of the Paris Climate Agreement. After a six month global campaign, including gathering 285 signatures from civil society organizations across the globe, a briefing to the US Government and mobilizing over 2 dozen organizations to write a letter of concern to the IDB EDs to oppose this project, IDB Invest cancelled the loan due to “environmental reasons.” 

3. Louis Dreyfus Company (LDC) Brazil (May 2022 letter) – We opposed the IFC’s proposed $200 million loan to LDC Brazil for purchasing industrial soy and corn produced in the Cerrado biome, a biodiversity hotspot. These practices pose immense social and environmental risks, warranting a more thorough Environmental Impact Review and stakeholder consultation. We only had 6 weeks to actively campaign before the Board vote but we were able to mobilize major global opposition. We generated 235 civil society signatories on our letter to the IFC, mobilized over two dozen NGOs to directly pressure the IFC Board of Executive Directors, held meetings with the US, German, Nordic, Dutch and Canadian Executive Directors, delayed the loan twice, generated an op-ed in Foodtank and press in Germany and Brazil, resulting in the IFC agreeing to present its full agribusiness portfolio to the Board and getting two governments to abstain in the Board vote. 

4. Alvoar Lacteos (April 2023 letter)– We urged IFC executive directors to delay their vote on a proposed $32 million loan to Alvoar Lácteos, a Brazilian dairy giant, pending a comprehensive analysis of the company’s environmental and social impacts. Sinergia Animal conducted an investigation that exposed how Alvoar’s suppliers are violating IFC performance standards. Following these efforts, IFC engaged with Alvoar on strengthening animal welfare conditions, though it is unclear if there were any on-the-ground changes as a result. 

5. Guangxi Yangxiang (May 2023 letter) – We contend that the IFC should not proceed with a proposed loan to Guangxi Yangxiang (GXYX) for working capital for four multi-story pig farms and a feed mill. Despite claims of compliance with OIE pig welfare guidelines, there is a concerning lack of transparency in the assessment process. This controversial project was approved in 2023 but continues to receive negative press due to the scale and potential impacts of the operation.

Our letters are backed by data from academic research, white papers, and public databases highlighting several social-ecological risks tied to these investments:

• Sustainability Violations
• Inadequate Safeguards
• Lack of Local Consultation

Sustainability Violations

The practices of these companies directly conflict with MDBs’ sustainability goals and internal policies. Industrial livestock operations are a major cause of deforestation; case in point, Marfrig’s purchase of cattle from ranches was responsible for over 3,300 hectares (8,154 acres) of illegal deforestation in just two years. This is just one aspect of the broader environmental degradation associated with these projects. LDC’s purchase of soy and corn is expected to lead to further deforestation in the Cerrado, where half of the native vegetation has already been lost to industrial farming. Other inputs, such as pesticides and fertilizers, contribute to the destruction of water sources, soil, and biodiversity.

Animal welfare concerns also feature prominently. Investigations into Alvoar’s suppliers revealed troubling practices, including the use of caustic paste for dehorning and premature slaughter. Meanwhile, The Observer documented S3F’s investigation into the concerning conditions at GXYX pig farms despite IFC’s intentions to fund them.

Inadequate Safeguards for Sustainability

Many of these issues could have been avoided with stricter company regulations and better auditing processes by MDBs. Marfrig’s history of illegal deforestation, human rights abuses, and corruption is well-documented, yet the company faces only a vague deadline of 2030 to achieve 100% traceability and zero deforestation. Alvoar on the other hand, lacks the capacity to implement robust environmental and social management systems and shows no alignment with Net Zero or Paris Climate goals. MDB assessments of these projects often lack transparency, leading us to suspect that procedural negligence is being used to obscure deeper issues.

Lack of Local Consultation

Factory farming operations disproportionately impact local communities, yet these projects often fail to include proper stakeholder engagement plans. This is particularly concerning in areas with histories of conflict:

 “This project fails to consider the concerns of locally affected communities and stakeholders in a region plagued by land conflicts and significant environmental, health, and labor rights issues.”

– S3F letter on LDC project

Similar concerns about social inclusion have been raised about Marfrig, which was removed from Nestlé’s supplier list after an investigation linked its cattle farms to invasions of Indigenous lands.

Fighting the Good Fight

These letters are one of many ways the S3F campaign is making the case against funding factory farming alongside our global allies. We fight to protect communities worldwide from industrial livestock’s harmful impacts, pushing MDBs to take responsibility and redirect their funds toward sustainable solutions.