Exports and Deforestation: A Commodity-Level Analysis

Wequantifytheextenttowhichinternational demandforagricultural commodities drives deforestation. Using panel data for 138 countries and 18 commodity groups during 2001–2022, we estimate commodity-specific elasticities of deforestation with respect to exports. To address the potential endogeneity between exports and supply-driven deforestation, we instrument exports with an export share‑weighted average of destination‑market import demands, constructed from a gravity model of bilateral trade. We find that a 10% increase in exports of agricultural commodities increases commodities-associated deforestation by 2.96%. We also find heterogeneous effects across commodities and regions, with the largest effects for perennial and tree crops, livestock, soybeans, and sugar crops. Back‑of‑the‑envelope calculations suggest that increases in international demand account for approximately 53 million hectares of agricultural expansion into forests between 2001 and 2022, corresponding to 49% of the observed forest-to-agriculture conversion.