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close this bookCommercialization of Non-Timber Forest Products in Amazonia (NRI, 1993, 26 p.)
View the document(introduction...)
View the documentForeword
View the documentAcknowledgements
View the documentAbbreviations
View the documentGlossary
View the documentSummary
View the documentIntroduction
View the documentRubber and extractive reserves
View the documentOther extractive products
View the documentImpact of commercialization
View the documentThe future of extractivism
View the documentResearch and development priorities
View the documentConclusions
View the documentReferences
View the documentAppendix 1
View the documentAppendix 2

Impact of commercialization

Impact on welfare

Socio-political factors

The main case studies show the impacts of road development and ill-defined tenure situations on the welfare of extractors/forest dwellers. For example, the problems in Acre were mainly brought about by the federal policy of frontier expansion, fuelled by a combination of new roads and subsidized credit for ranching and agriculture. Privatization resulted in rapid land speculation and concentration, followed by outmigration and deforestation.

Clay (1992) observes that the babasituation is typical of areas where supplies of products were established prior to any resolution of land rights problems. The harmful impact of babadevelopment on people's welfare was due to a combination of the lack of formalization of usufruct rights of the resident extractors on large landholdings, and the land privatization and processing changes. Peasants only obtained access to babaif they supplied labour on a regular basis and sold the produce back to the landlords. This precarious access was lost when roads, subsidies and credit encouraged other land uses, and is further evidence that commercialization increases economic and social differentiation when land distribution is skewed.

In these examples it is clear that Government policy had a crucial role to play in determining the negative effects on welfare disbenefits and resource depletion. Foreign aid initiatives must also take a major share of the blame. Many of these errors have now been recognized and acted upon: ranching subsidies have been eliminated; road building stopped (due to a change in donor policy); and extractive reserves endorsed. However, violence over land rights continues almost unabated according to recent reports (Schwartzmann, in press).

The commercialization system

The basis of the production and marketing system in most of Amazonia has been aviamento. Rural union leaders hold that it is the continual shifting of the terms of trade against extractors, ameliorated by short-lived price booms, that is the main cause of rural to urban migration. The case study of the decline of Brazil nut extraction in Para State shows how extractors lost interest in the resource and are now more interested in clearing the forest for agriculture (O'Donnell Sills, 1991).

Escape from this system depends on distance and access to market (hence the importance of the road system), alternative employment opportunities and the definition of tenure and property rights, any of which reduce the control of the merchants or patraos.

Low producer returns also result from oligopolistic wholesale and export market structures, as exemplified by the Mutran family domination of the Brazil nut trade. However, as Padoch (1989) points out, it is too simplistic to blame the middleman. The costs and risks of transportation and marketing are often high, especially in high inflation economies like Brazil, Peru and, until recently, Bolivia.

Welfare is undoubtedly better for those few groups fortunate to be on the receiving end of alternative marketing arrangements as those set up by such as Cultural Survival and the Body Shop. In the latter case, the price to extractors has tripled. However, there are serious doubts about the dependency effects and sustainability of these artificial marketing arrangements.

The stage of the product's boom-bust cycle

Torres and Martine (1991) point out that when an extractive product gains acceptability in the market, there is an irresistible commercial pressure to substitute it with synthetic substitutes or by its domestication in the form of plantations, since extractivism is unable to satisfy the rapid increase in demand. In fact the success of a product tends to hasten its own demise: a product which experiences a slower growth in demand is more likely to survive this process.

Homma (1989) presents a series of recent examples to show that extractive products are not compatible with the market's need for standardization and continual expansion. Inconsistency and inelasticity of supply of most extractive products is often the catalyst for substitution, as in the case of baba Another factor which stimulates the substitution process is that as demand expands, extraction tends to more remote areas, thereby increasing per unit costs (Schmink and Wood, 1986). The clearest example of this is Brazil nuts.

The bust phase is made worse when extractor groups narrow their livelihood base in favour of particular products. The boom part of the cycle may tempt extractors away from broad-based production systems to inherently unstable markets, although some extractor groups have been careful to maintain livelihood diversity (Nugent, 1991). In particular the maintenance by caboclo groups of sustainable swidden management systems has been a key factor in their survival (Parker, 1989).

The impact of boom-bust extractivism has been particularly severe on indigenous communities. Padoch and de Jong (1990) conclude that the wholesale movement of people from one location to another in search of profits from forest products (including timber and fauna) has played a major role in the loss of traditional culture of native peoples in the Peruvian Amazon (see case study, page 2).

Impact on extractive resources

Browder (1992) contends that resource depletion occurs in both the boom stage of the market cycle 'as rational extractors seek quick profits' in a situation they know to be ephemeral, and also in the bust stage as extractors are forced to 'harvest the resource above sustainable thresholds to maintain their living standards'.

The causes of resource depletion vary with the nature of the products. In cases where destructive harvesting can be practiced and a rapid demand increase has occurred, then Browder's analysis seems correct, as in the cases of rosewood oil, palm hearts and aguaje. In the case of the latter two, sustainable management is possible, but is conditional on tenure security. Copaiba and sorva have also suffered from over-exploitation, but recent appropriate technology innovations have led to the introduction of more sustainable harvesting methods which are preferred by extractors (Sizer, 1991).

It is fortunate that many of the extractive products of the Amazon depend on non-destructive harvesting methods and can survive these pressures, although even these may not be immune: the increasing subdivision of holdings in Acre has led to super-exploitation of rubber trails according to Oliveira (in Browder, 1992), while over-harvesting of Brazil nuts may be contributing to lack of regeneration in Acre (Nepstad et al., in press).

In most cases resource depletion has been caused by the socio-political and economic factors which have led to changes in land use. This is clear in the Brazil nut and babacase studies. It should also be pointed out that some of the depletion has been caused by commercial logging pressures, notably in the cases of Brazil nuts, andiroba, ucuuba and maracanduba.

In the case of baba the introduction of more efficient processing technology shows that increasing the value of the resource without accompanying tenure and institutional changes is insufficient to ensure resource conservation and lends more weight to the proponents of extractive reserves.

Impact on biodiversity conservation

Schwartzmann (1989) proposed that the production system in the pre-extractive reserve area he studied was 'indefinitely sustainable' at prevailing subsidized rubber prices. He pointed out that many of the families had been on the same holding for 40 to 50 years and had retained 98% of the holding in natural forest.

Browder (1992) affirms that extractors also clear forest for pasture and agriculture, pan for gold, hunt game and cut timber. As Thiele (1990) has pointed out with respect to small farmers or campesinos in the Amazon Basin, their management practices are likely to be guided by short-term resource depleting profit maximization goals, when given the opportunity.

Sizer and MacMillan (in press) points out that it has been their very shortage of capital and lack of direct access to markets that has limited the impact of extractors on forest resources. Therefore escape from aviamento and the greater freedom of extractors, even in the context of extractive reserves, may be a threat to big-diversity conservation. Browder (1992) and Sizer and MacMillan (in press) point out that the objective of extractive reserves is to maximize human welfare, not necessarily to conserve biodiversity.

Anderson (1992) reports that 'more than 15% of the (San Luis de Remanso extractive) reserve had been degraded by the resident population for shifting cultivation and pasture conversion'. Recent evidence from Nepstad (in press) and Oliveira (in Browder, 1992) in Acre State shows an increase in clearance for subsistence agriculture and pasture: livestock and pasture development are regarded as the logical and most beneficial use of surplus funds in a high inflation economy. At the same time Brown (in press) points out that while extractive reserves cover only one percent of Brazil's rainforest, their location has impeded clearance in the highest pressure areas, as in eastern Acre.