Dec 07, 2009

Grace Period To Be Extended For Compliance With Brazilian Environmental Law

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

The major source of greenhouse gases emissions from Brazil is due to deforestation and the best way cut down on those emissions would be to reduce deforestation and to increase reforestation projects throughout Brazil. That was the goal of legislation passed in Brazil in late 2008 that mandated that every rural landowner throughout the country develop a reforestation plan for his land if too much of the land had been cleared originally. As you might suspect, complying with the law has caused massive headaches for Brazilian landowners and government officials.

One year ago, the Brazilian Congress passed a law that made it an environmental crime if landowners in Brazil cleared more land than what had been permitted. The law allowed for a one-year grace period for landowners to present a plan on how the reforestation would be accomplished. That grace period is scheduled to end on December 11, 2009, but very few of the hundreds of thousands of landowners in Brazil have been able to comply with the law. Government officials are meeting this week to discuss the situation and it is widely expected that the grace period will be extended.

Under the legislation, if the land is deemed to be in the Lowland Amazon Region, then 80% of the land must be forested. If the land originally had cerrado vegetation, then 35% of the land must be forested. For the remainder of the agricultural areas in Brazil, 20% of the land must be forested. Less than half of the 370,000 rural landowners in the state of Parana for example have complied with the law. Nationwide, the National Confederation of Agriculture estimates that 90% of the rural landowners have not complied with the law. The original law allowed for fines of up to R$ 100,000 for those who did not comply as well as the possibility of jail time.

Nearly every rural landowner in Brazil feels that the law was very poorly designed and that landowners are being made scrape goats in order to achieve political gain. They point out that small family farmers (under 150 hectares) cannot afford to set aside part of their land for reforestation and they certainly cannot afford to pay a fine if they do not comply. There are multiple other problems with the legislation such as what to do about fruit crops or land used for irrigated rice production. Additionally, the law does not address how land could be divided and passed down to the farmer's children of if other parcels of land could be purchased to fulfill the original set aside requirements.

As the world leaders gather in Copenhagen for the United Nations Climate Conference, Brazilian officials want to demonstrate that they are serious about combating deforestation in their country. The environmental Minister of Brazil, Carlos Minc, declared that there couldn't be any amnesty for those who cleared land illegally. The Agricultural Minister of Brazil, Reinhold Stephanes, countered by declaring that landowners in Brazil cannot be penalized for prior actions that may have been legal at the time and land was cleared that Brazil has already placed 31% of the world's forests into preserves.