The wooden canoe floated across a current so clear that each pebble shimmered in the riverbed beneath. Farther downstream, the river plunged over a sheer waterfall, where a rainbow arched in the mist. The five Irantxe tribesmen banked their vessel and followed a trail through a dense stand of jatoba trees.

When they emerged after 50 yards, the landscape no longer looked anything like the southern edge of the Amazon forest.

It looked like Iowa.

Corn and soybean fields extended straight to the horizon. The only bright spots in the flat amber vista were seven green John Deere combines, parked near a farmhouse.

"If we were an aggressive tribe, we would have killed the land owners already," said Tupxi, one of the canoeists, who estimated his age at 77. "But we're peaceful, and we don't want to fight. So all of this has been lost."

The tribe's reserve is a forested island surrounded by thoroughly conquered farmland. It sits in the middle of Mato Grosso, a state whose booming agricultural sector has helped Brazil challenge the United States' position as the world's top exporter of soybeans and beef.

In the process, however, Mato Grosso has become the capital of Amazon deforestation. Much of the forest has been cut down, in many cases illegally, and turned into grazing pastures and soy fields. The state's governor, Blairo Maggi, owns the largest soy exporting company in the world.

In 2004, Amazon tree-cutting reached its highest level in a decade, according to statistics released by the government two weeks ago. Last year, more than 10,000 square miles were cut down -- an area the size of Belgium. Mato Grosso, one of five Amazonian states, accounted for 48 percent of the overall deforestation.

Environmental groups slammed authorities for lax regulation and accused Maggi of sacrificing natural treasures for agricultural wealth. The government countered last week by announcing it had arrested a large illegal logging ring. According to the government, about half of the 89 people arrested were employees of the agency responsible for enforcing logging regulations.

Maggi's environmental secretary was arrested on charges of helping loggers bypass regulations. Maggi fired him and promised to crack down on illegal logging.

But the measures didn't placate tribes such as the Irantxe, whose members said their rainforest culture had been toppled by buzz saws.

"It is all about money," said Napuli, a 31-year-old tribesman. "If they try to keep land for tribes like us, they would lose the money they would make on farming."

Last Remaining Tribesman

The members of a government expedition peered through the trees at a partly subterranean dwelling of mud and sticks. They had walked five hours through the Amazon jungle in the state of Rondonia to find the last member of an isolated tribe. Six previous attempts to contact him had failed.

Two members decided to get a closer look. If the man was inside, they would signal they were friendly and then warn him that if he strayed too far, he might encounter farmers and jungle-clearing machines. A lopsided confrontation, they feared, might result in his death -- and his tribe's extinction.

One of the men approached the hut but suddenly turned and sprinted away -- with an arrow in his chest, recounted Orlando Possuelo, 20, a surveyor with the government agency responsible for protecting Amazonian tribes.

"The Indian shot an arrow at him through the opening. It hit him in the chest, but it was above the heart," Possuelo said, describing the expedition from his apartment in Brasilia, the capital. "We all started running, even the guy who was shot. He pulled the arrow out while he ran."

Two years ago, environmentalists cheered when Marina Silva, a longtime advocate of preserving the rain forest, was named to head the environment ministry. Last year, Silva helped enact protective measures that made almost 20 million acres of Amazon land off-limits to developers.

Her agency also placed protections on another 20 million acres surrounding a road project through the forest, and bolstered monitoring activities that doubled illegal-logging arrests in a year.

But the new deforestation figures came as a disheartening blow. In an interview in Brasilia, Silva asserted that the new protections had not had time to show statistical results. Pointing to a map, she traced the "arch of destruction" -- a curved line through the Amazon where the highest concentrations of tree-cutting have occurred, and where new preservation efforts are being focused.

Possuelo's father, Sydney, a prominent Amazon expeditionist who now heads the federal tribal protection agency, is critical of official efforts to slow deforestation. If the sole tribesman in his remote Rondonia hut were to die, he added, the entire surrounding area could be legally opened up to farming.

"When it comes to protecting the Amazon," he said, "the government is getting progressively worse."

Soybean Production Thrives

At the airport in Cuiaba, Mato Grosso's capital, a large billboard greets arriving passengers. Pictures of forest are juxtaposed with those of farms and grazing cattle. There's a lot of land here, it suggests, and much of it is for sale.

Soybeans account for more than 80 percent of the state's exports, fueling an industry that exploded with the development of new seeds that can thrive in humid areas. The boom has created thousands of jobs and helped the national economy grow 4.9 percent last year.

Maggi was elected governor in 2002, and soon announced a goal of boosting the state's soy production to 100 million tons per year. His own business -- Grupo Maggi -- boasts yearly exports of $430 million.

Maggi declined to be interviewed, but a statement provided by his office defended the state's efforts against deforestation, including tougher licensing requirements on rural lands and stricter enforcement. In 2004, it said, the state registered 755 infringements and issued fines totaling $30 million.

In a 2003 interview, however, Maggi said environmentalists were exaggerating deforestation problems and threatening the Brazilian economy.

"Behind the environmental concerns are economic interests," he said. "They are trying to impede or slow the growth of Brazilian production."

Convincing Indian Leaders

At the intersection of the dry savannah and the rain forest in Mato Grosso lies the homeland of the Irantxe tribe. Their huts are surrounded by small clearings, where they grow manioc root and hunt game. At night, the Irantxe sit around the huts by candlelight, trading stories and improvising melodies on wooden flutes.

"In the beginning, a long time ago," an Irantxe woman named Kamutsi began, reciting a fanciful tale that explained how a wild pig deceived tribe members into eating palm leaves, which is why many have crooked and gapped teeth. The story flowed on, embellished by body language and sound effects.

But when Kamutsi was asked about the massive dust storm that forced the tribe members to hide inside their huts for two days last year, her voice died. This was not ancient lore, but real-life hardship.

"We had never seen anything like that before," said a fellow tribesman named Araxi, 42. "But we know it happened because the land had been cleared for the farms."

Tribal leaders who have witnessed illegal logging in Mato Grosso said Maggi had tried to woo them.

"He offers rice, clothes, gifts," said Makerosene, a leader of the Enawene-Nawe tribe. "He took us to a supermarket and said, 'Go ahead, take what you want.' "

But Makerosene said some of the Indians simply picked the most colorful products, even confusing cleaning fluids for food. They didn't really want any of that stuff, he said.

"What we want is our land protected."

Kanunxi, chief of the Irantxe tribe in Brazil, looks across corn and soybean fields that surround his tribe's land at the southern end of the Amazon rain forest.