Ramon Zacarillaz is a pioneer and lives on land where the forest is still burning -- big sour-smelling plots of smoldering logs and dark white smoke and ash-covered tree stumps.

Each burning acre is one pioneer's assault on the Paraguayan woods. From the shacks where they have brought their families, they are clearing the land with machetes and matches. Between the forest and the fires stretch their orange trees, their dark plowed soil, their pale green plots of new wheat and soybeans.

To ride along these dirt roads, the pickup truck tires kicking up thick red dust, is to imagine the first raw clearing a century ago of the American Midwest.

Zacarillaz came nine years ago to the land where his cabin now stands.

"I didn't ask anybody," he said. "I came and found forest and I began to work it...I was a Paraguayan, and I was working the land. I thought no one could take me away from the land."

Zacarillaz is so deeply Paraguayan that the only language he speaks well is Guarani, the glottal, Asian-sounding indigenous tongue that is still more widely spoken than Spanish here among many working-class and poor people. A bilingual Paraguayan translated into Spanish on this warm afternoon as Zacarillaz had his children cut down fat papayas for the visitors. Zacarillaz did not eat; he stood barefoot and bare-chested in the brick-colored dirt, his black hair damp on his forehead.

Around him stood his 10 children, his mint and manioc plants, the shed of stacked corn, the donkey and the fat pig, the baby chick that scrambled over Zacarillaz's toes looking for fallen papaya seeds. Zacarillaz had put three years of labor into this land when he was officially informed for the first time that it was not his. It belonged, Zacarillaz was told, to some North Americans called Gulf and Western.

A change of centuries had worked its way over the hills around Puerto Itaipyte while Zacarillaz was chopping the woods for his lands. To the north, pushed by the frantic energy needs of Brazil's industrializing Sao Paulo, giant bulldozers had begun shoving away the earth for the largest dam and hydroelectric project in the world. To the east, rapidly rising world soya prices were pushing Brazilians to sell their farms in Brazil at huge prices and then buy much larger lots in Paraguay.

To the west, the Japanese government was helping 8,000 Japanese settlers buy farming cooperatives and establish efficient and complex marketing systems for their produce. From every direction, multinational corporations -- the North Americans, the Germans, the Italians -- had begun snapping to attention at the investment potential of the eastern Paraguay state called Alto Parana.

And that is how Ramon Zacarillaz has come to owe the Agriex Co., a Paraguayan firm that is managed and partly owned by Gulf and Western, $78.55 per acre for land that Gulf and Western bought when land was worth about one-sixth that price.

Zacarillaz is relatively prosperous by Paraguayan colonists' standards -- he has 400 orange trees on his homestead -- and he said, possibly feeling constrained in front of a North American stranger, that although he thought the price at first was very high, he has come to believe he will be able to pay it eventually.

"If they knew me, I think they would want me to stay," he said. "The land may belong to Agriex, but everything you see on it is mine."

From the reports of the Paraguayan church organization working with families like Zacarillaz's, there are others among the thousands of eastern Paraguayan pioneers who are not so philosophical about the corporate claims to their land, and their reactions have ranged from fear to occasional armed confrontations with Paraguayan troops. In the boom-town atmosphere near the Brazilian border, with land prices soaring and speculators hovering and agribusiness complexes sending huge machines out to knock down the trees, Zacarillaz is part of a Paraguayan tradition that is desperately trying not to get stampeded in the rush.

He is what Spanish-speaking Paraguayans call a colono, a homesteader, one of the landless peasants who have made it a long-accepted practice to clear unoccupied lands, either publicly or privately owned, for subsistence farms.

"The Paraguayans have always believed property belonged to the person who worked it," said Carlos Alberto Benitez, an Alto Parana-based church worker. It is a tradition that Benitez said has roots among the indigenous people of Paraguay, who were nomadic hunters and subsistence farmers.

"In Paraguay only 22 or 23 percent of the peasants have title to their land," added Tomas Palau, who works with Benitez on the rapidly multiplying land titling problems of both Paraguayan colonists and the Brazilian peasants who have been crossing the border to join them. "So you can understand the importance of occupation."

By Alto Parana standards, said Benitez and Palau, Zacarillaz and his neighbors are comparatively lucky. It may take them a long time to pay for their land, and many may have to pay with their produce, turning them into temporary sharecroppers for the international companies. There were newspaper reports that Gulf and Western at one point destroyed colonists' fields with tractors and used armed groups to keep them from expanding their holdings. But at least these colonists now seem to be assured of staying where they are, unlike the hundreds of other families who have been forced off private lands, or have paid for titles that turned out to be fakes.

In the 1950s and 1960s, when the government encouraged colonization projects on public lands in eastern Paraguay, homesteading flourished even on privately owned lands that had been held for many years by the same owner. Alto Parana was forestry and cattle-raising country then, the eastern flank of a slow and semifeudal country, and colonists were often either ignored or welcomed as potential new loggers in the woods.

But that was before soya prices shot up and the first gravel was poured for Itaipu, the massive dam Paraguay is building with Brazil. Land prices have risen from $9 an acre in 1973 to $135 or more, and one of the companies to get in early was Gulf and Western, which in 1974 bought 22,400 acres of Alto Parana for an undisclosed price from its long-time previous owner. The Zacarillaz family, along with about 1,500 other people, was firmly settled on Gulf and Western's new land.

"Of course we knew there were occupants," said Gabriel Malvetti, general manager of Agriex, the company to which Gulf transferred its Paraguayan holdings in 1979. "Land occupation is common. But as a right -- no. You have to respect private property. If you have a neighbor and you go into his backyard and clean it up and make yourself a little garden, is that right? What's your neighbor going to say?"

Paraguayan law recognizes a kind of compromise between squatters' and purchasers' land rights. Under a 12-year-old law, which apparently is only sporadically implemented, colonists who peacefully homestead private land are entitled to be paid for the improvements on the land, or to buy the land outright at a price that may be set by the government. So after considerable haggling back and forth -- Gulf originally wanted to sell the colonists smaller plots at higher prices -- each colonist family is now entitled to buy up to 49.5 acres at 8 percent interest and pay it off over 7 years. In addition, Agriex has promised to pay for the construction of schools, health centers and a police station.

"They have to pay us what the land is worth," said Malvetti. "How is the company going to justify to its stockholders that it's giving land away?"

Besides, Malvetti said, Agriex is selling the land for less than three-quarters of what the company could get on the open market. "A colonist can pay that, even if he does it by taking fish out of the Parana River," he said. "He has to pay for the land so he'll care for it, and it will be an incentive. You don't value what you get easily."

But it is difficult to explain exploding land prices -- a concept middle class Washingtonians have a hard enough time coping with -- to a pioneer who is clearing the woods with a machete.

"They say, 'Why should we pay $80 for land that five years ago cost $20?' " Benitez said. "That's the logic for us, but not for the peasants."

There is a special indignity now, Benitez added, for the many Paraguayan colonists whose families fought in Paraguay's two protracted wars with neighboring countries during the last hundred years.

"They say in the wars they won their lands, because the wars were fought over land," Benitez said. "So they say they've won their piece of land. And their owners, most of them, are foreigners -- Brazilians, Germans, some North Americans. So the colonists feel invaded. By their logic those lands are theirs, because they're Paraguayans. And how come so many foreigners come in and buy land when they have none?"