How commodities demand growth can affect the deforestation and the frontier expansion in the Brazilian Amazon region?

Terciane Sabadini Carvalho, Edson Domingues and Kenia Souza

No 332815, Conference papers from Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project

Abstract: A substantial increase of the world demand of commodities is expected between 2015 and 2025, according to the Food and Agriculture Organization of the United Nations (2016) projections. It was estimated that Brazilian soybean exports would increase by 32% and the beef exports would grow 40%. Historically, those activities are considered important drivers of deforestation in the Brazilian Amazon. Then, to meet these expansion, the region could depend on expanding its agriculture frontier. In order to study the consequences of these scenario over land use change and consequently over deforestation, we use an interregional dynamic computable general equilibrium model (CGE) for 30 regions in the Amazon and the rest of Brazil. In general, the results suggest that the aggregate deforestation would increase over time, which means an additional decrease in natural forest area, projected to be 1,610 km2 relative to the baseline. However, the additional deforestation is not very large in most of the regions, only marginally impacting annual rates. Nevertheless, soybean would have a stronger effect on both the economy and land use of Amazon and that its growth could lead to a shift of cattle towards other forest areas.

Keywords: Demand and Price Analysis; Resource/Energy Economics and Policy (search for similar items in EconPapers)
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:ags:pugtwp:332815

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