Solving Brazil's land use puzzle: Increasing production and slowing Amazon deforestation

Brazil has become an agricultural powerhouse, producing roughly 30 % of the world’s soy and 15 % of its beef by 2013 – yet historically much of that growth has come at the expense of its native ecosystems. Since 1985, pastures and croplands have replaced nearly 65 Mha of forests and savannas in the legal Amazon. A growing body of work suggests that this paradigm of horizontal expansion of agriculture over ecosystems is outdated and brings negative social and environmental outcomes. Here we propose four strategies that can reduce deforestation, while increasing production and social wellbeing. First, eliminate land grabbing and land speculation through designation of public forests. This would clarify land tenure and limit the pool of land available for uncontrolled expansion of agriculture and ranching. Second, reduce deforestation on private properties by implementing existing mechanisms in Brazil’s Forest Code to facilitate payments for environmental services, with support from market initiatives for sustainable sourcing of agricultural products. Third, incentivize increased productivity on medium and large properties through targeted investments. By stimulating adoption of proven technologies for sustainable intensification, this would help meet Brazil’s production targets and growing international demand for agricultural products, without expanding into new production areas. Finally, foster economic, environmental and social improvements through technical assistance to small farmers. Small farmers occupy a large swath of the Amazon and often lack access to technical assistance, production technology, and markets. Providing quality technical assistance to small farmers could help them better align production practices with local opportunities; increase household income and improve livelihoods; and reduce deforestation pressure. By implementing these four strategies in a coordinated effort between public and private agents, Brazil can show the world how to reduce deforestation while increasing agricultural output, reestablishing its leadership in managing natural resources and mitigating climate change.     

Persistence of cattle ranching in the Brazilian Amazon: A spatial analysis of the rationale for beef production

Fed by demand for beef within Brazil and in global markets, the Brazilian herd grew from 147 million head of cattle in 1990 to ≈200 million in 2007. Eighty-three percent of this expansion occurred in the Amazon and this trend is expected to continue as the industry bounces back from a recent agricultural downturn. Intensification of the cattle industry has been suggested as one way to reduce pressure on forest margins and spare land for soybean or sugarcane production, and is the cornerstone of Brazil's plan for mitigation of greenhouse gas emissions. To this end, federal credit programs and research and development activities in Brazil are aligning to support intensification goals, but there is no guarantee that this push for intensification will decrease the demand for land at the forest margin and as result curb CO₂ emissions from deforestation. In this paper we use a spatially explicit rent model which incorporates the local effects of biophysical characteristics, infrastructure, land prices, and distance to markets and slaughterhouses to calculate 30-year Net Present Values (NPVs) of extensive cattle ranching across the Brazilian Amazon. We use the model to ask where extensive ranching is profitable and how land acquisition affects profitability. We estimate that between 17% and 80% of land in the Amazon would have moderate to high NPVs when ranched extensively if it were settled, i.e. if the rancher does not buy the land but acquires it through land grabbing. In addition, we estimate that between 9% and 13% of land in the Amazon is vulnerable to speculation (i.e. areas with positive NPVs only if land is settled and not purchased), which suggests that land speculation is an important driver of extensive ranching profitability, and may continue to be in the future. These results suggest that pro-intensification policies such as credit provision for improved pasture management and investment in more intensive production systems must be accompanied by implementation and enforcement of policies that alter the incentives to clear forest for pasture, discourage land speculation, and increase accountability for land management practices if intensification of the cattle sector is to deter new deforestation and displace production from low-yield, extensive cattle production systems in frontier regions of the Brazilian Amazon.     

Livestock intensification as a climate policy: Lessons from the Brazilian case

Brazil is trying to identify ways to ally economic growth with climate change mitigation. Productivity gains in livestock have been pointed out as a promising alternative to achieve that goal. Thus, this paper analyses the economic impacts of a policy of productivity gains in the Brazilian livestock. Besides, we evaluate if the policy may conciliate agricultural growth and deforestation control, bearing in mind the reduction of greenhouse gas (GHG) emissions from land-use changes. The analysis was carried out through a computable general equilibrium (CGE) model, tailored to represent land-use changes, GHG emissions and removals. Besides, it made progress modeling the heterogeneity of climate, soils, and emissions in inter-regional models with many regions. The results show that productivity gains can effectively “save” land and thus avoid deforestation, especially in the Amazon and Cerrado (savannah) biomes. The policy also may boost the economic growth, spreading it to other regions of Brazil, like Centre-West and North, and increasing income and consumption in those places. However, as a climate policy, focused on the reduction of GHG emissions, the results may be counterproductive. The net amount issued may increase, as a result of the positive stimulus of the policy on the economy, and GHG emissions are directly related to the economic growth.     

Forests or fields? A response to the theory that tropical forest conservation poses a threat to the poor

A rebuttal is provided of David Wood's proposal to open up tropical forests to agricultural uses. Concern is raised that his proposal exaggerates the ability of forests to regenerate after agricultural uses, sacrifices tropical forests in the name of alleviating poverty and in support of large land owners, and prevents valuable potential resource use by local populations. There is misunderstanding by Wood of conservationists' postures and the cause of current deforestation. In Brazil, deforestation has occurred primarily for low productivity cattle pasture (62% of all private land in the Amazon region in ranches over 1000 hectares-ha). Only 11% of private Amazonian land was in farms of less than 100 ha; only 30% of this size farm area was involved in 1991 in deforestation, while 70% of deforestation took place on ranches over 100 ha. Mass migrations of Brazil's population from the northeast to the Transamazon Highway and from Parana to Rondonia were impelled by increasing concentration of land tenure in migrant areas, and not by population growth. The rate of deforestation has slowed due to the economic recession. A World Bank study indicates that redistributing unproductive large landholdings in northeastern Brazil would increase agricultural output by 80%. The agricultural productivity of tropic areas is not as assured; Wood's support is based on preliminary findings, which are being revised with more cautionary thinking. Wood also understates the maintenance of soil fertility with fertilizers. The issue of scale also affects the use of agroforestry and perennial crop plantations such as rubber and cacao, which can only absorb the production of small areas, due to marketing constraints and physical resource limitations. Conservationists have not effectively redirected World Bank efforts to protect environments and help the impoverished, as suggested by Wood. Forest recovery has been very slow in large cattle pastures, and would take thousands of years if the land is left undisturbed. Recovery even under traditional shifting cultivation schemes is slower than Wood recognizes. Wood's argument that deforestation is temporary is not sufficient to invalidate the claim for conservation now. Reallocation is really the same as land extensification; current practices in Brazil will not support large human populations. The solution is to develop environmental services and find other means to support rural populations in urban areas.     

The impact of commodity price and conservation policy scenarios on deforestation and agricultural land use in a frontier area within the Amazon

Deforestation in the Amazon is caused by the complex interplay of different drivers. Price of commodities such as beef and soya, and incoming migration are paramount factors. Construction of new highways is a key aspect, as they enable a growing flow of people and economic activities, provoking an intensification of the conversion of forests into pasture and agricultural areas. The pavement of road BR-163 accelerates the expansion of the agricultural frontier from the state of Mato Grosso to Pará, inside the Amazon. Today, the Brazilian government applies two main kinds of policies to protect the environment. First by establishing conservation units (CUs) that include an array of reserve types from natural areas to indigenous lands, and second by enforcing the Forest Code (FC), a law that limits the occupation and use of forests. Legal reserve requirements for rural properties are 80% in the Amazon rainforest, 35% in the Cerrado shrublands and 20% in other regions. However, the effectiveness of these policies relies on a fragile institutional capacity, which causes a flawed monitoring, law enforcement and control. To assess the impact of effective conservation policies on land use and deforestation by 2020, we used the LUSMAPA model in combination with two scenarios, one that included different commodity price developments and migration rates and one on the assumption of the institutional strength to uphold the conservation policies. A revision of the FC from an average 80% policy target to 60% effective implementation and disregard borders of CUs by allowing 5% deforestation in CUs, that both corresponds to a ‘weak’ governmental enforcement, leads to additional deforestation of 41–57%, depending on the commodity price scenario. The results of the simulations are discussed in the light of recent policy changes in Brazil.     

Land governance as a precondition for decreasing deforestation in the Brazilian Amazon

This paper’s aim is to show that improvements in land governance in Brazil, and particularly in the Amazon region, have been the main pre-condition enabling reductions in deforestation of the Amazon rainforest. Deforestation occurs primarily where property rights are not clearly established, and occurs mostly on land directly or indirectly under state responsibility. This paper also shows that land speculation plays an important role in deforestation. Based on these findings, it is evident that Brazil must improve its land governance in order to decrease rates of deforestation. The Brazilian government has adopted important new efforts to improve land administration, including improvements in the registration process and the Terra Legal program, which are addressing public land problems across large areas of the Amazon. The concluding section highlights how efforts to reduce deforestation will only be possible through more efficient land governance, especially in the Amazon region, and discusses the important role that participatory land governance may play in improving land use and land ownership through application of land taxes.     

Land occupations and deforestation in the Brazilian Amazon

Researchers are increasingly interested in understanding the impact of contentious social processes on land change. In the Brazilian Amazon, there are often contentious interactions between landholders defending private property rights and squatters who have the right to occupy land that is deemed unproductive. Previous studies suggest that the contentious social processes inherent in the Brazilian land tenure and land reform system cause a significant amount of deforestation. An environment of insecure land title, and policies that value deforested land over forested land, among other factors, encourage both landholders and squatters to deforest more land than is necessary for pasture or crop production. This paper examines the impact that land occupations have on deforestation at the municipal scale across the Brazilian Legal Amazon, from 2000 to 2009. We show that land occupations have a direct influence on deforestation. We use spatial analysis as well to show that land occupations have a spatial component in the effect on deforestation: occupations in one municipality affect deforestation in adjacent areas.     

Crossing spatial analyses and livestock economics to understand deforestation processes in the Brazilian Amazon: the case of São Félix do Xingú in South Pará

The Amazon is the largest tropical forest area on Earth, and has been undergoing rapid deforestation for the last four decades. In the Brazilian Amazon, large‐scale pasture for cattle ranching and soybean production are the main land uses, leading to a yearly deforestation rate of 0.5%. These conversions are mostly located in frontier areas distributed along the so‐called “arc of deforestation”. Within this large zone, various land use change processes are interacting through several modes of land valuation and organisation. From several case studies in the State of Pará (Brazil), the current project aims at analysing how landscape dynamics are related to infrastructure development, ecological conditions, zoning policies and to the evolution and the organisation of the production, consumption and marketing chains of livestock products. This paper presents the results for one test site, the region of São Félix do Xingú, South of Pará This region is the focus of land speculation, cattle expansion, and deforestation. Road construction, investments in electrical energy, financial credit for cattle, and the land reform policies have all fuelled this process. All these factors make this region one of the most dynamic agricultural frontiers in the Brazilian Amazon. The main objective of the paper is to improve our understanding of deforestation processes by crossing spatial analyses and 1ivestock economics.studies, and to characterise the role and impact of various natural and anthropic factors in the location and development of the main types of farmers, and their policy implications.     

Estimating the opportunity costs of reducing carbon dioxide emissions via avoided deforestation,using integrated assessment modelling

Estimates show that, in recent years, deforestation and forest degradation accounted for about 17% of global greenhouse gas emissions. The implementation of REDD (Reducing Emissions from Deforestation and Forest Degradation in Developing Countries) is suggested to provide substantial emission reductions at low costs, although cost estimates show large uncertainty. Cost estimates can differ, as they depend on the approach chosen, for example: giving an economic stimulus to entire countries, taking landowners as actors in a REDD framework, or starting from protecting carbon-rich areas. This last approach was chosen for this analysis. Proper calculation of the economic cost requires an integrated modelling approach involving biophysical impact calculations and their associated economic effects. To date, only a few global modelling studies have applied such an approach. In modelling REDD measures, the actual implementation of REDD can take many forms, with implications for the results. This study assumes that non-Annex I countries will protect carbon-rich areas against deforestation, and therefore will refrain from using these areas as agricultural land. The opportunity costs of reducing deforestation within the framework of REDD were assessed using an integrated economic and land-use modelling approach comprising the global economic LEITAP model and the biophysical IMAGE model. One of the main methodological challenges is the representation of land use and the possibility to convert woodlands land into agricultural land. We endogenised the availability of agricultural land by introducing a flexible land supply curve, and represented the implementation of REDD policies as a reduction in the maximum amount of unmanaged land that potentially would be available for conversion to agriculture, in various regions in the world. In a series of model experiments, carbon-rich areas in non-Annex I countries were protected from deforestation. In each consecutive scenario the protected area was increased, starting off with the most carbon rich lands, worldwide systematically working down to areas with less carbon storage. The associated opportunity costs, expressed in terms of GDP reduction, were calculated with the economic LEITAP model. The resulting net reduction in carbon dioxide emissions from land-use change was calculated with the IMAGE model. From the sequence of experiments, marginal cost curves were constructed, relating carbon dioxide emission reductions to the opportunity costs. The results showed that globally a maximum of around 2.5 Gt carbon dioxide emissions could be avoided, annually. However, regional differences in opportunity costs are large and were found to range from about 0 to 3.2 USD per tonne carbon dioxide in Africa, 2 to 9 USD in South America and Central America, and 20 to 60 USD in Southeast Asia. These results are comparable to other studies that have calculated these costs, in terms of both opportunity costs and the regional distribution of emissions reduction.     

From “Green Hell” to “Amazonia Legal”: Land use models and the re-imagination of the rainforest as a new development frontier

Critical scholars have addressed land use models and related technologies by pointing to their epistemological underpinnings and the social consequences of visibilities and invisibilities induced by these instruments to different forms of governance. More recently, in addition to reaffirming the old dictum that the map is not the territory, some scholars have analyzed how land use models can shape perceptions, narratives and policy, and in this way “make” the territory and the state. In this study, we adopt the notion of sociotechnical imaginaries to highlight the role of land use models and basin-wide development schemes in the emergence of military developmentalism in the Brazilian Amazon. We show that earlier surveys of the Amazon were created in order to substantiate territorial claims and to guide the exploitation of natural rubber and other extractive resources. Mapping of the rivers as arteries with limited upland assessment implied a view of the Amazon as an immutable and invincible nature where resources were given as elements of natural landscapes. The approach of economic sectorial mapping that had dominated earlier surveys began to shift during and especially after World War II in an effort to imagine Amazonia as a separate and identifiable policy space which transformation would be possible with the application of development frameworks, such as the one derived from Tennessee Valley Authority (TVA). Likewise, experts from the United Nations Food and Agriculture Organization played a key role in providing land use models and assessment that “proved” the economic viability of large-scale colonization projects. This article points out that the extensive occupation and ongoing destruction of the Amazon rainforest was also informed by US large-scale planning regimes infused with technoscientific approaches derived mostly from Global North scientific institutions. Those concepts underpinned imaginaries of an integrated region whose “planning surface” would be oriented by the idea of the “Legal Amazon”, subject to a technocratic, centralized and authoritarian style of developmentalism. In this way this paper shows how land use models are not mere representations of the territory but also carriers of sociotechnical imaginaries that coproduce radical changes in social and natural landscapes.     

Public policies can reduce tropical deforestation: Lessons and challenges from Brazil

Reducing carbon emissions from deforestation and forest degradation now constitutes an important strategy for mitigating climate change, particularly in developing countries with large forests. Given growing concerns about global climate change, it is all the more important to identify cases in which economic growth has not sparked excessive forest clearance. We address the recent reduction of deforestation rates in the Brazilian Amazon by conducting a statistical analysis to ascertain if different levels of environmental enforcement between two groups of municipalities had any impact on this reduction. Our analysis shows that these targeted, heightened enforcement efforts avoided as much as 10,653 km² of deforestation, which translates into 1.44 × 10⁻¹ Pg C in avoided emissions for the 3 y period. Moreover, most of the carbon loss and land conversion would have occurred at the expense of closed moist forests. Although such results are encouraging, we caution that significant challenges remain for Brazil's continued success in this regard, given recent changes in the forestry code, ongoing massive investments in hydro power generation, reductions of established protected areas, and growing demand for agricultural products.     

Productivity growth and convergence in crop, ruminant, and nonruminant production: measurement and forecasts

Projections of future productivity growth rates in agriculture are an essential input for a great variety of tasks, ranging from development of an outlook for global commodity markets to the analysis of interactions between land use, deforestation, and ecological diversity. Yet solid projections for these variables have proven elusive—particularly on a global basis. This is due, in no small part, to the difficulty of measuring historical total factor productivity growth. Consequently, most productivity projections are based on partial factor productivity measures that can be quite misleading. The purpose of this work is to provide worldwide forecasts of agricultural productivity growth till the year 2040 based on the latest time series evidence on total factor productivity growth for crops, ruminants, and nonruminant livestock. The results suggest that most regions in the sample are likely to experience larger productivity gains in livestock than in crops. Within livestock, the nonruminant sector is expected to continue to be more dynamic than the ruminant sector. Given the rapid rates of productivity growth observed recently, nonruminant and crop productivity in developing countries may be converging to the productivity levels of developed countries. For ruminants, the results show that productivity levels in developing countries are likely to be diverging from those in developed countries.     

Bioelectricity in Malaysia: economic feasibility,environmental and deforestation implications

We investigate the economic feasibility of bioelectricity production from biomass in Malaysia and its impact on greenhouse gas (GHG) emissions and storage, agricultural prices, agricultural employment and deforestation. For this purpose, we develop a partial equilibrium model that projects agricultural prices, production, imports, exports, domestic consumption and land use in 5‐year increments between 2015 and 2065. Our results show that by 2030 biomass‐generated electricity can supply 36.5 per cent of the electricity generated in Malaysia, 16 times more than the 2016 electricity supply from biomass. Increased bioelectricity production from biomass will significantly reduce GHG emissions and will help Malaysia meet its commitment in the Paris Agreement to mitigate GHG emission by 45 per cent before 2030. Our modelling shows that biomass‐generated electricity creates a derived demand for waste biomass that expands the area of oil palm plantations. The expansion lowers agricultural prices, boosts agricultural employment and leads to some deforestation as landowners clear rainforest to plant oil palm trees. Nonetheless, the deforestation does not increase GHG emissions since GHG gains from bioelectricity significantly exceed GHG losses from deforestation.     

Amazon forest on the edge of collapse in the Maranhão State,Brazil

The year 2019 in Brazil was marked by environmental setbacks, which catalyzed the increase of illegal deforestation and fire rates in the Brazilian Amazon. In the Amazon region of Maranhão state, original forest cover diminished from 25 % (24,700 km²) in 2016 to 24 % (23,967 km²) in 2019, and 6,038 km² of remaining forests were degraded by fires and/or illegal logging – processes related to high levels of violence against indigenous and rural communities. Almost half of all deforested areas in the region (36,060 km²) are considered a global restoration hotspot, however secondary vegetation remains unprotected and 8,294 km² were cleared between 2014 and 2018. Due to uncontrolled deforestation and fragmentation, Maranhão has no more forest core areas (outside protected areas) with the minimum size to ensure sustainable forest management practices for timber production. New policies at the state level must promote old-growth and secondary forest conservation and restoration. However, the trends point to the opposite direction: the Ecological-Economic Zoning (ZEE) allows the reduction of forest protection and the State Forest Policy reinforces federal legislation setbacks. The Amazon region of Maranhão state has forest aptitude, and forest and agroforestry product chains would bring social and environmental benefits, making them the best opportunity for sustainable economic development in the region. Therefore, the forest must be re-planted for the benefit of people and nature.     

Assessment of land use and land cover changes and valuation of carbon stocks in the Sergipe semiarid region,Brazil: 1992–2030

The semiarid region in the state of Sergipe, Brazil, approximately 11,000 km², has experienced high deforestation rates in the last decades, which ultimately contribute to global climatic changes. The valuation of ecosystem services of CO₂ sequestration can support definition of environmental policies to decrease deforestation in that region. This study aimed to assess land use and land cover changes in the Sergipe semiarid region between 1992 and 2017 by applying remotely sensed data and technics; simulate the land use and land cover changes between 2017 and 2030 by applying a cellular automaton model, by assuming current land use trends (Business as Usual – BAU) as a reference scenario, and a more conservative scenario (Protected Forest – PF), in which was assumed an effective enforcement of the Brazilian Forest Code established in 2012; simulate the carbon stocks by 2017 assuming the BAU and PF scenarios by 2030, and estimate the Carbon balance between the 2030 and 2017 scenarios; and estimate the economic valuation of carbon emission and sequestration by using the InVEST software. The results showed that agriculture (cropped lands) was main driver of the landscape changes in the study area, which increased 14% by 2017, a net increase of 1494.45 km². The results showed that the total Carbon emissions would reach 736,900 Mg CO₂-eq by assuming the BAU scenario, which would increase the cost of opportunity up to US$ 17.7 million and a social carbon cost varying between US$ 10.3 and US$ 30.2 million. The restoration of the permanent preservation areas could contribute to increase Carbon sequestration up to 481,900 Mg CO₂-eq by 2030, which is equivalent cost of US$ 11.6 million. The natural landscape in the Sergipe semiarid region was strongly affected by deforestation activities occurred between 1992 and 2017. It requires, therefore, effective actions to support and promote restoration of degraded areas. The forested areas within the Sergipe semiarid region were the most affected type of vegetation because of expansion of agricultural fields soil exposures (Exposed Land). Environmental assessments based on scenarios and economic valuations can provide crucial information to support policy and decision makers to improve strategies for environmental management and conservation.     

Towards zero deforestation and forest restoration in the Amazon region of Maranhão state,Brazil

The Amazon forest in the state of Maranhão ensures ecosystem services that directly and indirectly affect the life quality of its population and economy, via hydrologic and climatic regulation, among other benefits. Currently, only 25% of the original forest cover (24.7 thousand km²) remains while illegal deforestation persists in a violent process that provokes visible social, economic and environmental harm. Simultaneously, Maranhão has seen record levels of burning, faces a water shortage and fights against the worst social and economic indicators in the country. Conversely, secondary vegetation covers 19.9 thousand km² (27% of deforested area) and is completely unprotected. Contrary to the international commitments assumed by Brazil to combat deforestation and restore forests, some of the political representatives of Maranhão have sought legal mechanisms to further diminish forest cover in public and private areas. To promote the conservation and restoration of Maranhão Amazon Forest, a multi-institutional network of researchers was established in 2015. This viewpoint paper aims to draw attention to this endangered region of the Brazilian Amazon and give science-oriented recommendations to policy makers in order to avoid more setbacks. We argue that Maranhão state must urgently establish a policy of Zero Deforestation, protect secondary forests and comply with the national forest restoration policy, thus ensuring long-term economic sustainability.     

The pioneer market for forest law compliance in Paragominas,Eastern Brazilian Amazon

This paper explores farmers’ motivations to participate in a market mechanism to come into compliance with the forest laws in Brazil. As of July 2008, farmers with deforestation beyond what is legally permitted can choose between compensating for illegal deforestation at another property or restoring this environmental debt in situ. The study analyzes the first real case of such a compensation market in the Amazonia, started in 2014 in the municipality of Paragominas, Pará. I explore the main features of the Paragominas compensation market in order to understand why farmers with forest deficits would opt for such a mechanism. In particular, the main question explored in this study is: what economic and environmental factors influence the choice to compensate rather than restore in properties with a legal reserve deficit in Paragominas? Results show that an increase in the percentage of illegal deforestation that occurred up to 2008 on a property is associated with an increase in the predicted probability of choosing compensation, when keeping agriculture as a land use, the property size, and the number of land uses in the property unchanged. The study also reveals that farmers with forest deficits may prefer to buy a forest area instead of renting for compensation if they have enough capital to invest.     

Drivers and projections of vegetation loss in the Pantanal and surrounding ecosystems

Modeling scenarios can help identify drivers of and potential changes in land use, particularly in rapidly changing landscapes such as the tropics. One of the places where most of the recent anthropogenic land use changes have been occurring is the "arc of deforestation" of the Amazon, where several scenarios have been constructed. Such modeling scenarios, however, have been implemented less frequently in wetland areas, but these are also undergoing rapid change. An example is the Pantanal, one of the largest wetlands on the planet located in the Upper Paraguay River Basin (UPRB). The UPRB is formed by the lowland (Pantanal) and the plateau (Cerrado and Amazon where the spring-fed rivers are). We used a spatially explicit model to identify drivers of vegetation loss in the Pantanal and surrounding area (UPRB) and estimated potential vegetation loss for the next 30 years. The model is probabilistic and considers that vegetation loss is contagious, so that the local rate of deforestation increases over time if adjacent sites are deforested, also taking into account the drivers identified in those locations. Our study is the first to simulate vegetation loss at property-scale, over 20,000 properties, for the entire UPRB in Brazil, taking into account the relationship between the plateau, where headwaters are located, and the lowland, where flooded-areas are concentrated. The drivers of vegetation loss identified for the lowland (distance to roads and rivers and elevation) differed from those for the plateau (distance to cities), demonstrating the relevance of analyzing areas separately. The cumulative rate of native vegetation loss projected for 2050 was 3% for the lowland and 10% for the plateau, representing losses of 6045 km² and of native vegetation area decreasing from 87% to 83% and 7960 km² from 39% to 35% respectively by 2050, if changes continue at the same pace and if the environmental legislation is followed. The projected vegetation loss in the UPRB forms a geographical arc, very similar to that observed in the Amazon, from the plateau into the lowland. The arc is directly related to areas with no or low flooding frequency because they are suitable for agriculture. The identification of this arc of vegetation loss calls for urgent conservation policies for this wetland and new perspectives for management.     

Wages,Prices and Agriculture: How Can Indian Agriculture Cope with Rising Wages?

Rapid economic growth in India has resulted in rapidly rising rural wages. Using the framework of variable profit functions and household level data, we study econometrically the wage impacts on crop agriculture. Rising wages are associated with decreasing crop output, other things being equal. Crop prices would need to increase by 80% in the short run to offset the effect of an agricultural wage increase, or by 140% in the short run to offset rural non‐farm wage increases as well. However, because non‐land farm assets respond positively to the non‐farm wage, in the medium term this increase is reduced to 74%. During the period of 1999/00‐2007/08, growth in non‐land farm assets, the labour force, education and technology has easily compensated for the wage increase, and probably also for the accelerating wage growth. Focusing on growing these shifter variables is a much better policy option than raising prices that would come at the expense of consumers or taxpayers.     

Ethanol expansion and indirect land use change in Brazil

In this paper we analyze the indirect land use change (ILUC) effects of ethanol production expansion in Brazil through the use of an inter-regional, bottom-up, dynamic general equilibrium model calibrated with the 2005 Brazilian I-O table. A new methodology to deal with ILUC effects is developed, using a transition matrix of land uses calibrated with Agricultural Censuses data. Agriculture and land use are modeled separately in each of 15 Brazilian regions with different agricultural mix. This regional detail captures a good deal of the differences in soil, climate and history that cause particular land to be used for particular purposes.Brazilian land area data distinguish three broad types of agricultural land use, Crop, Pasture, and Plantation Forestry. Between one year and the next the model allows land to move between those categories, or for unused land to convert to one of these three, driven initially by the transition matrix, changing land supply for agriculture between years. The transition matrix shows Markov probabilities that a particular hectare of land used in one year for some use would be in another use next period. These probabilities are modified endogenously in the model according to the average unit rentals of each land type in each region.We ask whether biofuel expansion is consistent with new laws, limiting forest clearing in Brazil. A simulation with ethanol expansion scenario is performed for year 2020, in which land supply is allowed to increase only in states located on the agricultural frontier. Results suggest that each new hectare of sugar cane requires only 0.14 ha of new land, with another 0.47 ha converted from pasture use. Hence policies limiting deforestation are unlikely to prevent greater ethanol production. Finally, regional differences in sugarcane productivity are found to be important elements in ILUC effects of sugar cane expansion.