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Borders between Mercosur countries have become a hub for trafficking agrochemicals

  • Seizures of counterfeit, adulterated and stolen agrochemicals in Brazil have grown with the global economic impacts since the COVID-19 pandemic, with much of the contraband originating in China and arriving via neighboring South American countries.
  • The trafficking in agrochemicals has been co-opted by organized crime syndicates that control the routes from Paraguay to Brazil, with most of the crimes recorded with these products also linked to drug trafficking.
  • Half of the pesticide seizures in Brazil involve illicit products, up from just 5% in 2010, and involve products banned in the country yet widely used for growing soybean, corn, cotton and bean crops.
  • The Brazilian market for pesticides is valued at $14.4 billion a year, yet tax and economic losses due to crimes involving agricultural inputs was almost $4 billion in 2022.

The borders between the countries that make up the South American trading bloc Mercosur (or Mercosul in Brazil) have an economic life of their own, where different characters subsist. An important part of the commercial force is connected to the trafficking of goods through these national borders, which maintains a large illegal industry.

In the center of South America, the triborder region between the cities of Foz do Iguaçu (Brazil), Puerto Iguazú (Argentina) and Ciudad del Este (Paraguay) is a hotspot for crimes of all sorts. The Paraguayan city of about 250,000 inhabitants is linked to Brazil by the Friendship Bridge.

Every day, more than 40,000 vehicles and more than 80,000 pedestrians cross it. Connecting Argentina and Brazil in the same region, the Fraternity Bridge is crossed by 5,000 vehicles daily. The Brazil-Uruguay border extends along the entire southern border of the Brazilian state of Rio Grande do Sul.

Goods arrive in Ciudad del Este from all over the world through the municipal customs office or the customs office at Guarani Airport, 15 kilometers (9 miles) away by road.

The 3,366 metric tons of agrochemicals that arrived in Paraguay in 2022 through these two ports represent 27% of all the country’s agrochemical imports last year, says the National Customs Directorate (DNA).

At the same time, seizures of agrochemicals (pesticides, fertilizers and other farming inputs) have skyrocketed in recent years, with 29,000 bottles, boxes and bags confiscated in 2022 on the Brazilian side. All came from Paraguay.

This is a 549% increase over the total seized in 2021, or around 4,500 items.

In a warehouse of the Brazilian Federal Revenue Service, packages with pesticides are waiting to be destroyed . Image by Arcenio Acuña.
A Brazilian Federal Revenue Service warehouse spanning 8,300 square meters (89,300 square feet) is filled with illegal products from Paraguay. Image by Arcenio Acuña.

Mafia scenario

André Dorecki, commander of the Military Police Border Battalion in Brazil,  says he has no doubts that the smuggling of agrochemicals has entered the realm of organized crime, which controls the illegal routes along the Paraguay-Brazil border.

Most of the illicit activities involve marijuana and cigarettes and are linked to drug trafficking in 139 cities monitored by the border battalion in the Brazilian state of Paraná. Most of the seizures in recent years included agrochemicals.

A Paraguayan police source, who is not being named for safety reasons, says the value of the trade in agrochemicals has stirred gangs’ interest. In the Alto Paraná region, these products are even stolen from farms. It’s the same story in the Argentinian state of Misiones, on the border with Brazil and Paraguay.

“Just one [farmer] lost almost $50,000 worth of agrochemicals,” says Rubén Sanabria, an engineer and director of the Agricultural Coordination of Paraguay (CAP), a private association of farmers.

In February 2020, Paraguayan authorities seized nearly 20,000 cartons of cigarettes and 103 boxes of agrochemicals. The operation was carried out by military personnel, DNA agents, and the Paraguayan Federal Prosecutor’s Office.

At the time, authorities also raided five warehouses in the city of Salto del Guairá, also bordering Brazil. To date, this was the largest antismuggling operation of the Mario Abdo Benítez government, which took office in August 2018.

Agrochemical trafficking can tarnish the image of the agricultural sector. “We want to end the idea that [farmers] are guilty, that there is a lot of smuggling of this and that. They are not the ones bringing the goods,” says Sanabria from the farmers’ association.

“The Paraguayan state agencies have to control [the criminality]. We, producers, are often overwhelmed by the authorities,” he adds.

A few kilometers from Ciudad del Este, a gigantic warehouse of the Brazilian Federal Revenue Service is where the seized goods end up. The vast majority come from Paraguay. The items stay there until they’re auctioned off or destroyed, as in the case of agrochemicals.

In 2021, 8 metric tons of these products were destroyed. In 2022, the amount jumped to 52 metric tons. The growth of almost 600% surpassed that of any other illicit product, including marijuana.

Monstrous imports

According to a report by the NGO Social Base Investigations (BaseIS), between 2016 and 2017 Paraguay imported 6.2% of all agrochemicals sold in the world, amounting to 52,067 metric tons of these products.

Figures from the customs directorate indicate that between 2018 and 2022, Paraguay imported 199,286 metric tons of agrochemicals. Last year, 48% of these imports came from China.

According to Sanabria, it’s urgent that the national authorities take measures against the illegal use of agrochemicals, because this harms farmers working legally.

“[The authorities] have to act, because they know that the amounts imported and consumed don’t match. We have become a ‘triangulation country’ that in both countries hurts companies that pay taxes and work honestly,” he says.

Sanabria is an agroindustrial entrepreneur who lives in Hernandarias, a municipality 15 km from Ciudad del Este. He highlights how the flow of agrochemicals has changed radically in the country in recent decades.

“Twenty or 30 years ago, illegal agrochemicals were coming from Brazil. Today, Paraguay is a country that brings raw materials and produces many agrochemicals, and this has attracted traffickers of these products to the Brazilian market,” he says.

Dangerous liaisons

States and municipalities in the Brazilian midwest and south have been the focus, since the middle of the last decade, of national seizures of trafficked, counterfeit or stolen pesticides, according to police data evaluated by ((o))eco.

Eldorado and Campo Grande, the capital of the state of Mato Grosso do Sul, are hotspots for these crimes. The state tops the national rankings for these illicit activities.

The largest capture was 54.5 metric tons of pesticides in May 2017, in Eldorado. The municipality is 40 km (25 mi) by road from Paraguay.

From June to September 2022, a police operation seized 190 metric tons of illegal pesticides at borders and on highways, especially in southern Brazil. Thousands of cigarettes, drinks, weapons and also cars were seized. The goods were valued at about $830,000.

The NGO Border Institute for Economic and Social Development points out a higher traffic of illegal pesticides in the country on the BR-163 and BR-116 highways. These highways cut through agribusiness zones and have direct or other links with Paraguay and other neighboring countries.

Brazilian municipalities and states with the most seizures of illicit pesticides between 2016 and 2022. Source: PRF/Juan Ortiz.

Packages with powder and gallons are camouflaged under loads of firewood, soybeans, corn and other grains. They’re hidden in tractors, harvesters, cars and buses. Even cyclists are caught in the act. Small sachets of herbicides such as metsulfuron, used for growing oats, corn, soy and wheat, complicate inspection.

Highways in Brazil with the highest traffic of illicit pesticides between 2018 and 2021. Source: Border Institute for Economic and Social Development. Image by Gabriela Güllich.

Marco Palhano, head of the Cross-Border Crimes Sector of the Brazilian Federal Highway Police (PRF), says smaller loads trafficked through highways, roads and rivers can be carried in trucks and trailers until they reach Brazilian farming zones.

“There’s more trafficking and other crimes during field preparation and in hours and routes that are less favorable for inspection,” says Palhano, who has been fighting these crimes since the 1990s.

“There are companies doing security for trucks with pesticides from Paraguay to the Brazilian countryside,” adds Eric Cardin, from the Research Laboratory on Borders, State, and Social Relations (LAFRONT) at Western Paraná State University (Unioeste).

Counterfeit products come from neighboring countries, but also from cities like Ribeirão Preto, Franca and São José do Rio Preto, in the countryside of São Paulo state, or in Goiânia, capital of Goiás state.

“These are areas where they copy packaging and labels with more and more technique,” says Nilto Mendes, manager of the Committee to Combat Illegal Products of CropLife Brazil, which brings together the main pesticide manufacturers in the country.

Brazil has 33 twin cities with other countries across more than 16,000 km (10,000 mi) of Brazil’s land and river borders. Fourteen of them are connected by international bridges. Between Brazil and Paraguay, there are almost 1,400 km (870 mi) of land and river borders.

“There is no way to control trafficking and other crimes in this whole area,” says Fernando Marini, a consultant who has worked for almost 40 years in the agrochemical market and currently trains police, companies and farmers on how to deal with crimes involving agrochemicals.

“Aircraft take off from Paraguay and neighboring countries to spray crops along the border with products banned in Brazil,” he adds.

The situation is likely to get worse with new cross-border connections. Between Porto Murtinho (Brazil) and Carmelo Peralta (Paraguay), work on the Bioceanic Bridge began last November and is being funded by Itaipu Binational, a company jointly owned by both countries for hydroelectric power generation.

The bridge will reduce travel time and costs for businesses from Mercosur countries, the South American trade bloc created in 1991, with markets in Asia, Oceania and the United States.

In Paraná, the bridge between Brazil’s Foz do Iguaçu and Paraguay’s Presidente Franco is almost finished. In the state of Rio Grande do Sul, work on three bridges to Argentina was agreed upon in January by presidents Luiz Inácio Lula da Silva and Alberto Fernández.

Last November, 300 illegal ports were mapped by the Federal Police between Brazil’s Foz do Iguaçu and Paraguay’s Guaíra, all along the Paraná River and the Itaipu hydroelectric dam reservoir, an area spanning 1,350 km2 (520 mi2) — nearly the size of São Paulo or London.

Seizures also occur at seaports. Last August, 60,000 liters (15,850 gallons) of paraquat and other pesticides coming from China were confiscated in Itapoá, on the coast of Santa Catarina state. The substance is banned in Brazil. The cargo was mixed with chemicals to treat water.

“Where there is developed agriculture, there is this problem [of illicit use of pesticides],” Marini says.

Part of 14 metric tons of probable pesticides seized in a truck on the BR-316 highway in Teresina, capital of the northeastern state of Piauí. The invoice identified the white powder as fulvic acid, a type of fertilizer, but the inspection couldn’t confirm this and found the company responsible for the cargo wasn’t authorized to market products from abroad. Image courtesy of PRF/Brazil.

Empty pockets

Confiscations of illegal agrochemicals in Brazil fell between 2018 and 2019, but bounced back since the COVID-19 pandemic. The health crisis closed down factories and ports in China, the world’s largest producer of these commodities, boosted the dollar, and reduced the legal trade.

“In China, commercial partnerships between provinces and agrochemical manufacturers are common. The Chinese governments make a lot of money with this,” Marini says.

The seizures include herbicides and insecticides banned by the Brazilian government, such as paraquat and benzoate, used on soybean, corn, cotton and bean crops. Certain products are used to speed up harvests and reduce losses from severe droughts, such as the one that has hit southern Brazil in recent years.

Information from the National Union of the Plant Protection Products Industry (SINDIVEG) shows that irregular imports account for half of the pesticide seizures in Brazil. In 2010, this rate was only 5%.

For two decades, Paraguay has been the largest conduit to Brazil for illegal agrochemicals. Smaller amounts arrive from Argentina and Uruguay.

Trafficked, counterfeit and stolen pesticides account for 25% of the Brazilian market. The global average is 15%, says CropLife Brazil.

“The objective is always to cut costs in the face of economic or climate crises. Illicit items are much cheaper than legal ones, but they don’t collect taxes or use packaging [as required by Brazilian law],” Marini says.

A study by researchers at Unioeste points out that trafficked items cost 10-20% of the products sold in Brazil. The difference is due to taxes, rules considered to be rigid for releasing products, and the market reserve guaranteed by high import taxes.

 “The prices of products within countries are very unequal. Besides this, import taxes are high in order to protect the prices of these products on the Brazilian market,” says Unioeste’s Eric Cardin.

Calculations by the Center for Advanced Studies in Applied Economics at the University of São Paulo show that the rise in input costs, such as pesticides, is the main cause for the fall in agribusiness’s contribution to Brazil’s GDP, from 27% in 2021 to 25% in 2022.

Losses and damages

The pesticide market in Brazil is valued at about $14.4 billion annually. The tax and economic losses due to crimes involving agricultural inputs was $4 billion in 2022, says the National Forum Against Piracy and Illegality.

“Any investment against these crimes is cheap in view of the damage. We need permanent actions to investigate and punish those who benefit economically from these illicit activities,” says Arlindo Chinaglia, a member of the lower house of Congress and a Brazilian representative to Parlasul, the Mercosur parliament.

Trading and transporting agrochemicals requires federal licenses, but countless Brazilians risk life, liberty and property for short-term profits. The typical pay is less than $200 for trafficking 100 l (26 gal) of paraquat.

Marco Palhano, from the Federal Highway Police (PRF), says the “mules,” the people carrying trafficked items, usually receive instructions for delivery during their journeys, including via messaging app WhatsApp.

Many people caught in the act are detained and become primary defendants. Cars or other vehicles belonging to the suspects may be auctioned off by the Brazilian Federal Revenue Service.

Farmers caught with illegal agrochemicals can have their crops destroyed. Diluted products or those mixed with other chemicals may not even be effective against pests, and may even end up destroying crops. “In Mato Grosso, farmers lost up to 3,000 hectares [7,400 acres] at one time and broke down,” says Fernando Marini, the consultant.

Losses like these are rarely made public. After all, the farmers bear their losses in silence to avoid being fined for buying and using illegal items.

A load of pesticides seized by the PRF in Mafra, Santa Catarina state. Image courtesy of Divulgation/PRF.

Political and economic ties

Low taxes and legal benefits help maintain the trade in agricultural inputs by numerous companies established by Brazilians in Paraguay, mainly maquiladoras. They export products assembled with inputs from all over the world, with zero import taxes and other advantages.

“There are schemes of importation, production and smuggling of pesticides from legalized purchases by companies in Paraguay,” Marini says.

“Many border populations don’t see this as a crime,” adds Nilto Mendes from CropLife Brazil.

Regulatory and fiscal disparities across the Mercosur countries also allow agrochemical-related crimes to persist. “No neighboring country has banned paraquat, for example. This stimulates its trafficking to Brazil, which has banned its use,” Mendes says.

Chinaglia, the congressman, says that, unlike the European Union, Mercosur still has no common economic, health, environmental or inspection guidelines.

“There are national initiatives [to combat crimes with agrochemicals], but I am unaware of a collective action. But the countries involved have to act jointly at the borders. The responsibility is not unilateral,” he says.

For Congressman Arlindo Chinaglia, Mercosur countries have to act jointly against border crimes. Image by José Cruz/Agência Brasil.

Poisoned crops

The United States, Brazil, China and Argentina are the largest global users of pesticides and herbicides. According to the Brazilian Institute of Geography and Statistics (IBGE), the country has the third-largest absolute agricultural area in the world, about 350 million hectares (865 million acres). This represents 41% of the national territory and is larger than India.

Marina Lacôrte is coordinator of the agriculture and food campaign at Greenpeace Brazil. For her, the illicit activities linked to the trade and use of pesticides are directly connected to a national agribusiness industry based on monoculture of commodities for domestic consumption and export.

Under the former administration of Jair Bolsonaro, in office from January 2019 to the end of 2022, the government permitted the release of 2,182 new substances in Brazil — a record for any Brazilian administration. “Instead of prioritizing less toxic substances, the government accelerated the analysis of all chemicals,” Lacôrte says.

Many of the products approved in Brazil have been banned globally, but continue to be produced in countries that no longer use them. Paraquat is exported from China, but its use is prohibited there. It has also been severely restricted in the United States and Australia.

Most of the pesticides released under Bolsonaro’s watch come from China, and almost half contain substances banned for use in the European Union, according to a study by Sônia Hess, a postdoctoral fellow in chemistry at the Federal University of Santa Catarina, the State University of Campinas, and Sacro Cuore Catholic University in Italy.

For Congressman Chinaglia, using these products makes Brazilians “second-class citizens” and can jeopardize trade agreements with health and environmental requirements. For instance, the Mercosur—European Union agreement currently being hashed out could potentially reduce or cancel taxes on 90% of the products traded between the blocs. This could greatly expand Brazilian exports.

“At the same time, our exports may be contaminated by pesticides that are banned in the European bloc. This opens a window for commercial disputes,” Chinaglia says.

The ministries of agriculture, health and the environment are responsible for regulating the agrochemical trade in Brazil, including their effectiveness against pests and any risks to human and environmental health. However, there was little oversight during the Bolsonaro government, increasing risks to the population and farmers.

“The government’s strategy has been to increase control at the border, but at the same time to accelerate the use of products previously prohibited in Brazil, increasing the supply in the domestic market and favoring a reduction in production costs,” according to the LAFRONT lab at Unioeste.

Almost 4,700 pesticides are authorized in the country, and other substances may be released in greater quantity and faster if Congress approves the so-called Poison Package, as NGOs have labeled this controversial piece of legislation. Approved by the lower house, the bill is now pending in the Senate.

Civil society groups note that the text replaces the term “agrotoxin” with “pesticide” and “environmental control product”; allows mixtures, prescriptions before pest occurrence, and imports of carcinogenic items; shortens approval times; and weakens environmental and health risk assessments.

“The massive release of pesticides is tied to the growth of the national [agribusiness] area, interests of the Ruralist Caucus and the companies in the sector, and ends up stimulating the legal and criminal trade of these chemicals,” according to LAFRONT’s analysis.

“In general, the regular or irregular entry of pesticides into the country guarantees the main objective of these industries: the oligopoly over seeds and over the other chemical components used in all stages of the production cycle.”

According to Greenpeace’s Lacôrte, investigations are multiplying and confirming the contamination of water, soil, people and biodiversity, as well as the destruction of pollinators and the proliferation of diseases linked to pesticides, such as cancer.

“The inspection is far short of what is necessary to deal with the risks of these products, which are even more falsified and adulterated,” she says. “The [rest of the] world is on the way to reducing the use of these substances and banning them.”

This report was originally published in ((o))eco and produced with support from The Environmental Reporting Collective.

Banner image: Illustration by Gabriela Güllich, courtesy of ((o))eco.

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