Losing Forests to Fuel Cars

A worker walks through a sugarcane field in Brazil. The United States imported 500 million gallons of Brazilian sugarcane ethanol last year.
A worker walks through a sugarcane field in Brazil. The United States imported 500 million gallons of Brazilian sugarcane ethanol last year. (By Adriano Machado -- Bloomberg News)

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By Sabrina Valle
Washington Post Staff Writer
Tuesday, July 31, 2007

Jaguars, blue macaws and giant armadillos roam the fickle landscape of Brazil's Cerrado, a vast plateau where temperatures range from freezing to steaming hot and bushes and grasslands alternate with forests and the richest variety of flora of all the world's savannas.

That could soon come to an end. In the past four decades, more than half of the Cerrado has been transformed by the encroachment of cattle ranchers and soybean farmers. And now another demand is quickly eating into the landscape: sugarcane, the raw material for Brazilian ethanol.

"Deforestation in the Cerrado is actually happening at a higher rate than it has in the Amazon," said John Buchanan, senior director of business practices for Conservation International in Arlington. "If the actual deforestation rates continue, all the remaining vegetation in the Cerrado could be lost by the year 2030. That would be a huge loss of biodiversity."

The roots of this transformation lie in the worldwide demand for ethanol, recently boosted by a U.S. Senate bill that would mandate the use of 36 billion gallons of ethanol by 2022, more than six times the capacity of the United States' 115 ethanol refineries. President Bush, who proposed a similar increase in his State of the Union address, visited Brazil and negotiated a deal in March to promote ethanol production in Latin America and the Caribbean.

U.S. companies and investors -- including George Soros and agribusiness giants Archer Daniels Midland and Cargill -- are staking out territory in Brazil, expecting even greater growth in biofuels.

"There was already a race for Brazilian ethanol, and President Bush's announcements gave more credibility to the process," said Roberto Rodrigues, former Brazilian agriculture minister, who formed the Interamerican Ethanol Commission with former Florida governor Jeb Bush in December.

The Brazilian government and big agribusiness companies say that the expansion of soybean and sugarcane fields doesn't necessarily mean devastation of the Cerrado, which hosts an estimated 160,000 species of animals and plants, many threatened with extinction. They say they plant on wastelands and pastures where cattle once grazed, improving the soil quality and productivity.

But environmental groups argue that as soy and sugarcane displace cattle and less lucrative crops, ranchers are moving farther into the unspoiled areas of the Cerrado.

"There are ranchers substituting sugarcane for cattle in the Sao Paulo area, for instance, and displacing cattle to the state of Bahia, both in the Cerrado. So what is the point?" asks Ricardo Machado, author of a study about the Cerrado for Conservation International.

Sugarcane and soybeans play a crucial role in Brazil's agriculture, one of the most dynamic sectors of the country's economy. And both are under pressure to expand as a result of the ethanol boom.

Sugarcane is touted by environmentalists as a better option than corn for producing ethanol. Sugarcane ethanol costs half as much to produce, and the process is five times as efficient in its use of fossil fuels.

Lured by the prospect of making ethanol from Brazilian sugarcane, many U.S. firms are trying to catch up with European and Asian investors. The company Soros is backing, Adecoagro, has become one of the main investors in Brazilian ethanol, planning to spend $1 billion to build three plants over the next five years. Goldman Sachs and Carlyle Group are also behind new ethanol investments in Brazil.


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