Rapid expansion of sugarcane crop for biofuels and influence on food production in the first producing region of Brazil

This paper analyzes the influence of sugarcane on soybean and livestock productions in the state of Mato Grosso do Sul, in the Midwest of Brazil, the main agricultural region of the country. We also observed indirect influence of sugarcane in non-producing regions. Two periods have been analyzed, 2006-2009, which is the beginning of the sugarcane expansion, and 2009-2013, which is the main expansion phase. In this state, sugarcane is essentially used for ethanol production, and soybean and livestock production are the main food products, together with corn. The shift-share method was used, with decomposition of the evolution in area, productivity and geographic location effects. The area effect was divided between scale and substitution effects. Data were collected from national and local databases. From 2006 to 2009, sugarcane areas replaced soybean in the best land areas. In the second period, sugarcane and soybeans occupied pasture areas. None of the activities surveyed decreased its production between 2006 and 2013. Sugarcane generated positive externalities on food production in the state, forcing the evolution of productivity, mainly in cattle raising. Positive impact of sugarcane on the productivity of livestock and soybean reduces indirect effects of the production of biofuels on land use and didn't have a negative effect on food production. The increase in food consumption had a much greater impact on the evolution of crops, with a high increase in cultivated areas of soybean and pastures in Brazil.