In Brazil's Amazon, Cargill Grains Ports Meet Local Resistance

For centuries, riverside communities, including the "quilombola" descendants of enslaved Africans who escaped from plantations and ranches, have shared Xingu Island in Brazil's Amazon Basin.

Its inhabitants live in brightly painted wooden houses overlooking rivers where small boats crisscross between islands and Abaetetuba city on the mainland to trade fish, seeds and fruits gathered from the Amazon forest in their backyard.

In 2016, however, strangers docked on Xingu Island, in Para state, and staked it out with something unfamiliar: concrete fence posts.

Felled trees now rot on the ground by the posts marking out nearly 359 hectares (887 acres) of Amazon rainforest - land that was later bought by U.S. grain-trading giant Cargill and earmarked for a 700-million-reais ($143 million) port project that is bitterly opposed by many Xingu Island residents.

"I'm being harmed by this," fisherman Joao Assuncao dos Santos, 64, told the Thomson Reuters Foundation, gesturing towards Cargill's land parcel demarcated by the posts just a few meters (feet) from his house.

"My mango trees, acai trees, cupuacu trees are all on their side," said dos Santos. His family is one of 180 whose land rights over Xingu Island were recognized in 2005 by Brazil's federal government when it established a community agricultural and forest reserve, known as a PAE, in the area.

The islanders say Cargill never should have been able to acquire the land for the planned grain export terminal as it was part of the PAE reserve - a 2,705-hectare (6,680-acre) area used to source farm and forest products such as prized acai berries.

Dos Santos and other Xingu inhabitants are pinning their hopes of stopping the port project on a lawsuit involving federal prosecutors who found "irregularities" in the chain of documents and procedures that led to the land's sale to Cargill.

Prosecutors said in June that the process by which Cargill acquired the plot - which was originally public land - without consulting the local community "strongly resembles illegal practices" of land-grabbing. They also requested Cargill put on hold any measures to advance the project.

Prosecutors joined the lawsuit after the judiciary asked if they wanted to act on it - a common practice in legal cases with social impacts in Brazil.

In August, a criminal probe was launched by the federal prosecutors' office in Para state.

Cargill, the world's largest grains trader and the biggest privately owned company in the United States, told the Thomson Reuters Foundation it bought the land "in good faith and following all company protocols to ensure the legality of the operation".

Demand for dialogue
Land tenure is a persistent source of disputes in Brazil's Amazon, with speculation and "grabbing" of public or communal land - often for infrastructure development, agriculture or mining - linked to deforestation and Indigenous grievances.

A 2005 entry in Brazil's Federal Official Gazette states that Xingu Island, including the plot acquired by Cargill, was designated as a community agriculture and forest reserve named PAE Santo Afonso.

As well as using this land to plant crops and collect wood, seeds and fruit, locals said they fish from three lakes called Piri.

"When I was a kid and my parents were young, we went there in December to catch fish (and) shellfish," said Cleonice Araujo Cavalheiro, 70, who was born and raised in the area. "We came back with the baskets full."

But Piri is now partially enclosed by the fence posts.

In a 2022 court response to the lawsuit, Cargill said it had signed an agreement with port developer Brick Logistica in 2015 in which it committed to buy the area where it wants to build its port.

Notary registries and Cargill's response show the government officially sold the land to Brick Logistica in 2019 for about 1.38 million reais. Within a year, Brick Logistica resold it to Cargill for 53.2 million reais.

Brick Logistica said official documents show the land had been privately occupied "for at least 60 years". It was only used by locals for agriculture or ranching in that period with permission from those controlling it, the company added.

Cargill said the property it acquired had already been sold privately before the land was designated as part of the PAE.

The U.S. agribusiness giant faces additional legal action over its planned Abaetetuba port, which would be used by boats transporting up to 9 million tonnes a year of mainly corn and soy through the Amazon from Brazil's northern and midwest regions as an alternative to saturated roads and southern ports.

Last year, a Para state court ruled that islanders must be consulted as part of the port's licensing process. In August, the case was transferred to the federal justice system which has yet to rule on the issue, effectively putting the project on hold.

Rosalina dos Santos Teles, a leader of the Bom Remedio "quilombola" community on Xingu Island, said its members live just a few kilometers from the planned port and "demand to be consulted".

"In their (Cargill's) environmental studies, it is as though there was no one here," she said, showing a brochure outlining a community protocol for consultation on projects that affect it.

Cargill told the Thomson Reuters Foundation it had "spared no effort to dialogue with all social actors related to the project", adding that it was complying with the environmental licensing process for the port terminal.

"We have not and will not build a terminal until all required permits are in place and we have consulted with local communities," it said in a statement reported by Reuters after the criminal investigation was made public.

Infrastructure driving deforestation
The prosecutors' criminal probe comes as Cargill and other companies face local and international calls to prevent their port and rail infrastructure - existing and planned - from harming Indigenous and other communities, and the Amazon forest.

The grains trade in Brazil's Amazon Basin is expected to increase sharply if the region is connected to two planned railways - Ferrograo ("Grainrail"), which is backed by Cargill, and the Para Railway supported by China.

Mathew Jacobson, campaign director at U.S.-based environmental advocacy group Stand.earth, said Cargill is "dramatically increasing the infrastructure that drives deforestation" while making "public promises ... to phase out deforestation from their entire supply chain".

Cargill says on its website it has pledged to end deforestation across its entire agricultural supply chain by 2030. It did not respond to a request for comment on the impact of its infrastructure.

Barges belonging to a separate company are already docking on the strait where Cargill wants to build the Abaetetuba port, between Xingu and the smaller island of Capim - which locals say is driving fish away and putting them in danger.

"Traffic is getting ugly - one boat after another ... We can no longer fish at night, afraid that they will run us over," said Santo Afonso fisherman Jose Rosivaldo Rodrigues Cardoso.

He worries that larger waves from Cargill's grains ships could sink fishing boats if the port project goes ahead and starts operating as initially slated by 2025.

Others said they were concerned that its construction would destroy rocks that are a spawning and fishing area.

Asked about the complaints relating to its land acquisition, Cargill said its port project would use only a portion of the land it controls on Xingu Island.

The rest will be conserved "and may even continue to be used by residents", the firm said in a written response to questions.

Land deal in dispute
The criminal probe is connected to a lawsuit filed in 2021 by Catholic aid agency Caritas, which argues that the sale of the land now controlled by Cargill was based on illegal documents and procedures by government agencies, municipal officials and the companies themselves.

Lawyers for Caritas argue that means the land's transfer into private control should be reversed, calling for Cargill and Brick Logistica to compensate local families for collective damages "because of fraud in public registers" and the ensuing "economic, social and environmental" harm.

In its 2022 court response, Cargill said land titles issued by a local notary and signed by Abaetetuba mayors in 2001 and 2016 showed the municipality had verified the area's "occupation in good faith", paving the way for it to pass into private hands.

Caritas, however, said those documents were illegal as the municipality never formally owned the federal island land and so was not in a position to authorize its transfer.

The Abaetetuba mayor's office said the municipal attorney was re-examining relevant documents and would "act immediately ... if any irregularity in the titling is found".

There is also disagreement over the legitimacy of the process setting up the PAE. Cargill argued in its response to the Caritas lawsuit that the PAE Santo Afonso had not been formally established in accordance with government rules.

The National Institute of Colonization and Agrarian Reform (INCRA) told the Thomson Reuters Foundation it signed an agreement in 2005 with the federal government's property office (SPU), which led to the creation of about 320 PAEs in the Amazon including Santo Afonso.

In late 2021, INCRA excluded the land acquired by Cargill from the PAE Santo Afonso - a move it has since said it will reassess and which could be reconsidered.

The prosecution told the Thomson Reuters Foundation Xingu Island communities have a constitutional right to the area and should not be penalized by any shortcomings on the part of the state when it established the PAEs.

Amazon-wide threat
Researchers see the legal case over the land acquisition as having wider implications for Amazon forest communities.

Caritas said in the lawsuit that the land rights of more than 113,000 families living in Brazil's PAE settlements could be weakened if the arguments used to sell off the Santo Afonso land parcel are accepted by the courts.

According to INCRA, the PAE projects cover 9.8 million hectares - an area bigger than Austria or the U.S. state of South Carolina. It is now reassessing all requests for "enterprises" overlapping with PAE areas, it said.

Tatiane Vasconcelos, a law doctorate student at the Federal University of Para and author of the research underpinning the Xingu lawsuit, said there is "a movement to overrun" the PAE projects, using "the same modus operandi" across the Amazon.

Elsewhere in Para state, Indigenous and other traditional communities are at loggerheads with Cargill over two of its other Amazon river ports - Santarem and Itaituba - saying they were not consulted during the licensing process in compliance with Brazilian and international law.

In the case of Santarem, which began operating in 2003, Cargill told the Thomson Reuters Foundation it followed legislation in force on Indigenous studies and consultation at the time of its licensing process and "cannot be accused of not having complied with standards that came into force or were regulated" afterwards.

With Itaituba, in operation since 2017, Cargill said Amport, the association representing port terminals in Brazil's Amazon region, had filed a preliminary plan to consult local Indigenous communities but it was still awaiting government approval.

The Munduruku Indigenous people say ports managed by Cargill and other private firms in Itaituba harm their fishing and navigation activities, while also driving land speculation, invasions and land-grabbing within their territory - something they fear could be exacerbated by the planned Ferrograo railway.

Beka Saw Munduruku, a 21-year-old leader from the Amazon Sawre Muybu territory, traveled to Cargill's head office in Minneapolis on Oct. 12, to hand-deliver a letter to the Cargill-MacMillan family, which owns the company, urging them to stop destruction of her people's forest.

Cargill did not respond to a request for comment on the letter. In August, the company's president in Brazil, Paulo Sousa, called opposition to the Ferrograo railway "an irresponsibility".

"What is irresponsible is for your company to make promises to end deforestation while continuing to expand into our territories and giving license to others to do the same," the young Munduruku representative wrote in the open letter.

($1 = 4.8888 reais)

(Reuters - Reporting by Andre Cabette Fabio; Additional reporting by Avi Asher-Schapiro; Editing by Megan Rowling, Helen Popper and Alister Doyle. The Thomson Reuters Foundation is the charitable arm of Thomson Reuters.)