Expansion of Soybean Farming into Deforested Areas in the Amazon Biome in Mato Grosso, Pará and Rondônia States: The Role of Public Policies and the Soy Moratorium

In the 1990s and 2000s, soybean farming grew sharply, particularly in states located in Brazil’s mid-west region. To curb deforestation, the Federal Government implemented the Action Plan for the Prevention and Control of Deforestation in the Legal Amazon Region (PPCDAm). At the same time, soy-buying companies and Civil Society Organizations implemented the Soy Moratorium. This paper focused on the major role of these initiatives in decreasing soybean farming in areas deforested after 2006 and on their importance in achieving this result. We considered rich database deforestation, soybean planted area, and other critical explained variables, and used spatial panel models to a balanced database of 287 municipalities over eight years. The results confirm that lower deforestation rates in the biome laid the foundation for reducing soybean farming in the Amazon biome. However, since 2008, when the Soy Moratorium was launched, there was a structural decline in this relationship, and new plantations began to represent a small percentage of newly deforested areas. The soybean production chain is modern and organized in regional hubs and that its growth stems from stable institutional conditions in municipalities and their surroundings, as well as from the availability of skilled labor and credit. Therefore, government programs to reduce deforestation made room for specific private actions focused on soybean farming that created a new environment for agricultural expansion in line with Brazilian law and environmental commitments. The Soy Moratorium reinforced this new order, and this production chain became a case study on public and private governance, given its importance in reducing soybean farming in deforested areas after the cut-off date.