Your Paraguayan customer or buyer is asking for ESG information. Here is what the regulatory environment requires — and what international buyers need from you.
Paraguay is the world's fourth-largest soya exporter and a significant producer of beef, corn, and hydroelectric power. Paraguay generates nearly 100% of its electricity from hydroelectric sources — primarily the Itaipú and Yacyretá dams — making it one of the world's cleanest electricity grids. Paraguay's Comisión Nacional de Valores (CNV) is developing sustainability reporting requirements for listed companies. Paraguay's agricultural export sector faces transformative ESG compliance requirements from the EU Deforestation Regulation (EUDR) — soya and cattle are covered commodities — and from international buyer sustainability requirements. Deforestation in the Chaco region is a significant ESG risk for Paraguayan soya and beef exporters.
Key regulations in Paraguay — ESG Supplier Guide
Paraguay CNV — Sustainability Reporting Development
Paraguay's Comisión Nacional de Valores (CNV) is developing sustainability reporting requirements for listed companies. The framework is at an early stage, and the primary ESG compliance pressure on Paraguayan companies comes from international buyer requirements, particularly from EU buyers subject to CSRD and CSDDD, and from the EU Deforestation Regulation.
EU Deforestation Regulation (EUDR) — Soya and Cattle
Paraguay is the world's fourth-largest soya exporter and a significant beef exporter. Both soya and cattle are covered by the EU Deforestation Regulation. EU importers of Paraguayan soya and beef must demonstrate that these commodities were not produced on land deforested after December 31, 2020, and were legally produced. Paraguay's Chaco region — one of the world's most biodiverse ecosystems — has experienced significant deforestation for soya and cattle production. Paraguay is classified as a standard-risk country under EUDR, and Paraguayan exporters must implement geolocation data collection and deforestation verification systems.
EU CSDDD — Corporate Sustainability Due Diligence Directive
EU companies sourcing from Paraguay — particularly in soya, beef, corn, and timber — will be required under CSDDD to conduct human rights and environmental due diligence. Paraguayan suppliers will receive questionnaires on labour practices, environmental management, deforestation, and community rights. The soya and beef sectors face particular scrutiny given deforestation risks in the Chaco.
Paraguay Zero Deforestation Law — Chaco Moratorium
Paraguay's Zero Deforestation Law prohibits deforestation in the Eastern Region (east of the Paraguay River). The Chaco region (west of the Paraguay River) has a different regulatory framework that permits deforestation under certain conditions, including environmental impact assessments and compensation. The Chaco has experienced significant deforestation despite these regulations. International buyers conducting EUDR due diligence on Paraguayan soya and beef must verify that production did not occur on land deforested after December 31, 2020, regardless of whether deforestation was legally permitted under Paraguayan law.
What this means for you as a supplier
Paraguayan soya and beef exporters face urgent EUDR compliance requirements — geolocation data collection for production plots must be underway ahead of the December 2026 deadline. The Chaco deforestation risk means that Paraguayan exporters must be able to demonstrate that their production plots were not deforested after December 31, 2020, even where deforestation was legally permitted under Paraguayan law. EU buyers will require satellite-verified deforestation-free evidence. Paraguayan exporters should engage with their EU buyers on EUDR compliance pathways immediately. Paraguay's clean electricity grid — nearly 100% hydroelectric — is a genuine ESG advantage for Paraguayan manufacturers and processors.
Key dates
December 31, 2020
EUDR deforestation cut-off date — soya and cattle production on land deforested after this date is non-compliant, regardless of legality under Paraguayan law
December 30, 2026
EUDR applies to large EU operators — Paraguayan soya and beef exporters must demonstrate deforestation-free production
June 30, 2027
EUDR applies to SME EU operators — full EUDR compliance required for all EU market access
July 2029
CSDDD Phase 1 — largest EU companies must conduct supply chain due diligence including Paraguayan suppliers
Chaco deforestation: the critical EUDR risk for Paraguayan exporters
The Gran Chaco — a vast subtropical dry forest spanning Paraguay, Argentina, Bolivia, and Brazil — is one of the world's most biodiverse ecosystems and one of the most rapidly deforested. Paraguay's Chaco has experienced some of the highest deforestation rates in the world, driven by soya expansion and cattle ranching. Satellite monitoring by Global Forest Watch and other platforms shows significant ongoing deforestation in the Paraguayan Chaco. Under the EU Deforestation Regulation, soya and beef produced on land deforested after December 31, 2020 — even where deforestation was legally permitted under Paraguayan law — cannot be sold in the EU market. Paraguayan soya and beef exporters must conduct farm-level geolocation and satellite verification to identify and exclude deforested plots from their EU supply chains. This is a significant compliance challenge for exporters with large, complex supply chains in the Chaco region.
Hydroelectric power: Paraguay's clean energy advantage
Paraguay generates nearly 100% of its electricity from hydroelectric sources — primarily the Itaipú Dam (shared with Brazil, one of the world's largest hydroelectric plants) and the Yacyretá Dam (shared with Argentina). This gives Paraguay one of the world's cleanest electricity grids and a significant Scope 2 emissions advantage for manufacturers and processors. Paraguay is also a significant electricity exporter — it sells surplus hydroelectric power to Brazil and Argentina. For Paraguayan manufacturers and food processors seeking to demonstrate low-carbon production to international buyers, the clean electricity grid is a genuine competitive advantage. Companies should quantify and communicate their Scope 2 emissions in buyer ESG questionnaire responses. Paraguay's hydroelectric surplus also creates opportunities for green hydrogen production using clean electricity.
Last reviewed: April 2026. This guide is for general information only and does not constitute legal advice. Regulations change — verify current requirements with a qualified adviser.
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