Brazil’s governmental environment agency Ibama has fined local farmers and five grain traders – including Bunge and Cargill – for carrying out grain trading activities linked to illegal deforestation.

The farmers and ABC Indústria e Comércio, Bunge, Cargill, JJ Samar Agronegócios Eireli and Unigger Protecão de Plantas were fined a total of 105.7M reais (US$29M), of which 24.6M reais was imposed on the five grain traders, reported Reuters on 23 May.

According to Ibama, the firms had purchased nearly 3,000 tonnes of grains – including soyabeans – that had been grown in off-limits areas of the Cerrado savannah in central Brazil’s Matopiba region.

The Cerrado was one of the largest growing soya farming regions in Brazil due to cheap and widely available land subject to less strict deforestation rules than the Amazon rainforest.

The fines were part of Operation Soy Sauce, which in April saw Ibama clamp down on illegal land use in areas of the Cerrado that had been illegally deforested and designated as off-limits for agriculture to allow native vegetation to regrow.

The trading firms had purchased soyabeans under advanced purchase agreements that in come cases had financed illegal farming, said Ibama.

Cargill told Reuters that it had not received any notification from Ibama about the illegal soya purchases and that it would look into the matter.

Bunge said that its purchases complied with agricultural best practices and it had consulted databases on banned areas, adding that it supported Ibama and Brazil’s environmental conservation efforts.

Public prosecutors in Brazil were planning to take legal action beyond the fines to ensure that the farmers and agri traders repaired all environmental damage, said Reuters.