Deforestation

Why it matters

Approach

PepsiCo strives toward deforestation-free sourcing by 2025 and toward deforestation- and conversion-free sourcing by 2030 for high-risk commodities in our company-owned and -operated activities.² This means:

• Deforestation-free (DF): Striving to avoid ingredients produced on land that has been subject to deforestation or forest degradation after December 31, 2020.
• Deforestation- and conversion-free (DCF): Striving to avoid ingredients produced on land that has been subject to deforestation or forest degradation or converted from natural ecosystems (e.g., peatland, grasslands) after December 31, 2020.

Striving to achieve No Deforestation, No Peat, No Exploitation (NDPE) in our supply chains requires tackling systemic issues in specific geographies and commodities. This requires working in-depth with a wide range of stakeholders to identify and tackle those issues, which can take time. We are working with members of our supply chains, peer companies, civil society and others — directly and through multi-sector collaborations — in an effort to address the systemic issues that contribute to deforestation. These include challenges such as developing supply traceability, incentivizing conservation, identifying high-risk areas, root causes of deforestation and conversion such as poverty, lack of credibly-certified commodities and lack of universally-accepted definitions and protocols.

Policy

Our direct suppliers are expected to adhere to the following principles as part of our PepsiCo Stewardship of Forests and Natural Ecosystems Policy and our Global Policy on Sustainable Palm Oil:

• Compliance with applicable legal and regulatory requirements;
• No conversion of forest or other natural ecosystems as from the earlier of existing sector-wide cutoff dates or December 31, 2020.³ Tools that should be used where applicable to find areas not to be converted include:
  • High Carbon Stock (HCS) forests as defined by The HCS Approach;
  • High Conservation Value (HCV) areas as defined by the HCV Resource Network; and
• No new conversion of any peatlands and the use of Best Management Practices for existing operations on peatlands as described in the Roundtable on Sustainable Palm Oil (RSPO) Manual on Best Management Practices for Management and Rehabilitation of Peatlands.

Traceability in supply chains with risk of deforestation and conversion

As we strive towards deforestation- and conversion-free sourcing for high-risk commodities in our company-owned and -operated activities, it is important that we try to understand the source of the key commodities we buy. Traceability in certain supply chains can be challenging, since the suppliers we procure from may source the commodities from multiple other suppliers and producers. We work with independent third parties such as Proforest, Peterson and Earthworm Foundation to help strengthen procurement guidance, facilitate training and improve traceability templates and questionnaires along with analyzing results to monitor progress and plan future engagements.

For more information on our efforts to improve origin transparency, see our Sustainable Sourcing Guidelines.

Supplier engagement

PepsiCo endeavors to source from suppliers that strive to:

• Use sustainable forest and natural ecosystem management practices in lands they own, lease or manage to provide fiber, timber and other ingredients;
• Implement sustainable and regenerative agriculture practices and support landscape approaches that enable sustainable agriculture production and thriving natural ecosystems to co-exist;
• Preserve biodiversity and cultural values and optimize the social, environmental and economic benefits of managed forests and other natural ecosystems; and
• Implement the PepsiCo Stewardship of Forests and Natural Ecosystems Policy in a way that supports the inclusion of smallholders in their supply chains.

PepsiCo aims to work with its suppliers to support educational initiatives for smallholder farmers that provide useful resources to help prevent deforestation.

Progress

In 2024, PepsiCo took steps toward our deforestation-free goal in three key areas: enhancing traceability of the ingredients and materials that we source; leveraging technology to assess progress in the field and inform engagement with suppliers; and strengthening partnerships.

• Enhancing traceability: PepsiCo focused on enhancing traceability in our supply chain. We worked to identify the origins for in-scope ingredients and materials procured at the scale needed to confirm the DCF status, which may include to the aggregator or to the farm itself. This is a key enabler for progress toward our goal.
• Leveraging technology: we collaborated with Satelligence, a satellite monitoring platform, to help improve our capability to monitor deforestation events, detect early alerts and verify origins as deforestation-free in our palm oil (global coverage), sugarcane (Mexico) and cocoa (Brazil, Mexico) supply chains.
• Strengthening collaborations: we deepened our work with industry coalitions that support companies to progress on deforestation and conversion-free sourcing goals, such as the Consumer Goods Forum’s Forest Positive Coalition. We also joined new initiatives: PepsiCo formally joined WWF Forests Forward, focused on corporate action in support of nature, climate and people. At the field level, we continued to invest in landscape initiatives that support conservation, sustainable livelihoods and sustainable production in ingredient supply chain origins where forest and conversion risk exists. For example, we invested in a new initiative with our peers in Aceh, Indonesia aimed at respecting Indigenous Peoples and local community rights.

In 2024, approximately 90% of the high-risk commodities we sourced in our company-owned and -operated activities were deforestation-free.⁴

Industry-aligned methodologies are under development for conversion-free sourcing for most ingredients. Once methodologies have been developed, PepsiCo will assess scope and timing of reporting on our progress toward conversion-free sourcing. In the interim, we plan to report quantitative progress toward our deforestation-free sourcing ambition as data become available.

Crops and Ingredients⁵

Palm oil

In 2024, our global palm oil procurement was approximately 400,000 metric tons, of which palm kernel oil comprised approximately 4,000 metric tons. 99% of our total palm oil volume was physically certified (mass balance) by RSPO, and the remaining 1% was covered by RSPO Independent Smallholder (ISH) credits to achieve 100% RSPO certification. We were able to support small farms by purchasing approximately 3,000 metric tons of ISH credits.

For more details on our palm oil sourcing, see Palm oil, which includes annually updated information on total volumes, countries of origin and our direct suppliers, refineries and mill lists.

Paper/fiber

Wood fiber products are used in a wide range of PepsiCo's primary, secondary and tertiary packaging. PepsiCo's main fiber need is corrugated cardboard for secondary packaging. We seek to purchase only responsibly sourced wood fiber products. We aim to optimize the use of post-consumer recycled fibers in our packaging materials wherever feasible.

Our annual fiber volume in 2024 was approximately 1.3 million metric tons, with approximately 87% of our fiber supply covered by one of the following standards:

• Forest Stewardship Council (Forest Management and/or Controlled Wood)
• Programme for the Endorsement of Forest Certification (PEFC) or
• Sustainable Forestry Initiative (Forest Management only).

In 2024, approximately 70% of our paper volume was from recycled sources and less than 1% of our traceable virgin fiber volume was traced to origins with high risk⁶ of deforestation or degradation based on supplier declarations.

Soybean oil

We support protection of forests and other natural ecosystems in our soybean oil supply chain. In 2020, we became a member of the Roundtable on Responsible Soy Association (RTRS) and have been working with our suppliers to certify the soy we source from Latin America to RTRS standards.

In 2022, we engaged our direct suppliers from non-negligible risk origins to align on evidence to provide in 2023 for Deforestation- and Conversion-Free (DCF) volumes. Direct suppliers from high-risk origins have traceability and DCF monitoring systems in place, and we are working to incorporate these insights into our own traceability and DCF verification processes going forward. In 2024, we communicated the full CGF (Consumer Goods Forum) Forest Positive Approach  to these suppliers, and we introduced Supplier Scorecards. Additionally, direct suppliers are being assessed by the CGF's DCF Supplier KPIs. In 2024, PepsiCo engaged 100% of our direct suppliers from negligible risk and at-risk origins to achieve greater methodology alignment, including by engaging with the Soft Commodity Forum through the CGF Soy Working Group to make progress toward our deforestation-free goal. For direct suppliers sourcing from at-risk origins, PepsiCo has engaged more deeply. PepsiCo engaged all direct suppliers who sourced from Brazil in 2024. Most of our suppliers in Brazil and Argentina origins have high traceability to farm for their direct and indirect sourced soy, and in 2024 we worked to incorporate further supplier insights into our own traceability and DCF verification processes. PepsiCo also engages direct suppliers to understand and encourage action on their public commitments and support for sectoral/landscape initiatives.

Cocoa

Cocoa is primarily procured for use in our North America, Latin America and Europe food businesses. PepsiCo engages with select suppliers to improve traceability while supporting supplier-led verification programs and purchasing certified volumes. PepsiCo is also working with Satelligence to verify progress of select cocoa production landscapes via satellite monitoring and supplier engagement. In Southeast Mexico, we have engaged both our cocoa supply chain and surrounding communities to help deliver regenerative agriculture practices and improve livelihoods via trainings through our collaboration with Agrovita. In the future, PepsiCo will continue to seek opportunities to collaborate with other industry actors to support resilient cocoa landscapes.

Sugarcane

PepsiCo primarily procures sugarcane for use in its company-owned North America, Latin America, Europe and Africa & Middle East food businesses. We view purchasing certified cane sugar as an important way to support sustainable production of sugarcane. We are also actively working with select suppliers to build capacity for additional certified or verified volumes to support our demand in key origins. In 2024, 32% of the sugar that PepsiCo purchased was physically certified, and the remaining 68% was covered by Bonsucro credits. PepsiCo is also working with Satelligence to verify progress of key sugarcane production landscapes via satellite monitoring and supplier engagement. Beyond this, PepsiCo participates in industry groups, including Bonsucro and the Sugar Collaboration Group, to support greater alignment on DCF methodologies and efforts to remove deforestation, forest degradation and conversion from sugarcane supply chains.

Progress and Challenges

Strategic collaboration

We collaborate with a variety of stakeholders to design, launch and scale holistic solutions to complex challenges. This includes supporting and engaging with smallholder farmers, collaborating with suppliers and leveraging external technical and financial resources as we strive toward our pep+ (PepsiCo Positive) deforestation ambitions.

PepsiCo has joined Forests Forward, a signature WWF program for corporate action in support of nature, climate and people. Our initial work with WWF focuses on the responsible sourcing of our forest-based packaging, helping us to prioritize and advance our forest-related activities in an effort to yield the greatest positive impact for forests. We have also been working with Tropical Forest Alliance (TFA) since 2020 and currently sit on the Advisory Committee. TFA aims to drive change by working with the world's largest agricultural commodity players and leading consumer goods companies in tackling tropical deforestation. The Advisory Committee contributes expertise to inform the development and implementation of TFA’s strategy, striving to ensure alignment with best practices and emerging trends in the field.

For more detail on a selection of these collaborations, see Forest and Palm oil collaboration and engagement.

What's next?

We plan to continue to work with our suppliers, peers, civil society and others directly and through collaborative partnerships by:

• Continuing to work towards our ambition for no deforestation and no conversion for high-risk commodities in our company-owned and -operated activities;
• Working in multi-sectoral collaborations including the CGF Forest Positive Coalition of Action, Tropical Forest Alliance and Palm Oil Collaboration Group in an effort to tackle the systemic issues that drive deforestation across various commodities and regions;
• Reviewing the traceability and transparency of relevant supply chains to inform our strategy, approach and actions; and
• Investing in landscape-level initiatives to support conservation, resilience and sustainable production in ingredient supply chain origins where forest and conversion risk exists.

¹Global Forest Watch. (2025). Global Deforestation Rates & Statistics by Country

²PepsiCo set this ambition in its Stewardship of Forests and Natural Ecosystems Policy. High-risk commodities include ingredients and materials at high risk of deforestation and conversion as defined in our Calculation Methodology. Systemic challenges continue to be an industry-wide barrier to reaching fully deforestation-free sourcing, but we continue striving toward this ambition and have reached approximately 90% by the end of 2025

³Accountability Framework. (2022). Deforestation- and conversion-free supply chains and land use change emissions: A guide to aligning corporate targets, accounting, and disclosure

⁴Refined goal announced on May 22, 2025. 2024 performance calculated retroactively. For more information, see Calculation Methodology

⁵Ingredients and materials in scope for PepsiCo’s deforestation-free and deforestation- and conversion-free ambitions include those procured through direct and indirect purchasing models for use in wholly-owned PepsiCo manufacturing facilities and exclude ingredients procured by joint ventures, franchise bottler manufacturing, contract manufacturers and co-packers

⁶Risk was determined via the Earthworm Foundation’s Country Priority Matrix 2024 version