November 30, 2007

Argentina house passes forest law, agricultural clearing suspended
 

Argentina's House of Representatives voted unanimously on Wednesday (November 28, 2007) night to pass a law freezing deforestation fueled by farmers seeking to expand the agricultural frontier due to sky-high international commodity prices.

Last Thursday, the Senate passed the so-called Forest Law which will suspends all permission to clear wooded land for one year while provinces work with the Federal Environment Ministry to develop sustainable forest use plans. Provinces will have to designate certain forests as closed to development, others for limited use, and others as open for agricultural exploitation. The bill also creates a fund to compensate provincial governments and individual landowners for the inability to exploit their forests.

The compensation fund will total almost one billion pesos (US$318 million), with the provinces receiving 30 percent of payments and private landowners 70 percent.

According to the Environment Ministry, the pace of deforestation has picked up dramatically over the past four years. Between 1998 and 2002, 781,930 hectares of native forest were cleared for development, while from 2002 to 2006 1.9 million hectares went under the ax, according to the Ministry.

The clearing of forests in Argentina's northern provinces is being fueled by surging international soybean prices.

"High soy values have generated a real estate speculation process due to the difference in land prices in the central farm belt, which reach US$15,000 per hectare compared with US$1,400 per hectare in the (northern areas)," said Jorge Menendez, the director of the Environment Ministry forestry program.

Land that hasn't been cleared yet is even cheaper, at US$250-US$400 a hectare, Menendez said.

In addition to expanding soy production, a large amount of the northern forests are being cleared for cattle pastures.

Beef production is spreading as cattle are replaced by grain in the central farm belt and new pastures are planted in the northern provinces, said the director of Greenpeace's forestry campaign, Hernan Giardini.