Cattle-raising and public credit in rural settlements in Eastern Amazon

The practice of raising cattle in the Amazon has been connected to deforestation, which has been especially intense in the Eastern Amazonian state of Pará that contained 23% of new rural settlements before 2008. The settlements were part of a program of land reform that allowed farmers to receive public credit. Public credit aims to increase production and incorporation of new technologies by settled farmers, which can lead to a decrease in pressure on forested areas. Public credit, however, may also result in an increase in deforestation if farmers use the loans for extending their pastureland. In small farms with different characteristics situated in southeastern Pará, credit is not an important driver for the expansion of pastureland. The expansion was instead associated with larger farms and longer periods of cattle-raising. On the other hand, small farms cannot properly develop cattle-raising without credit. At least six years of operation and 25ha are required for changes in the indicators of cattle-raising activities to be detected. Small farms that are relatively new to bovine production have more difficulties accessing public credit and face strong constraints to increasing the herds and the production of milk.