"At the very edge of the agricultural frontier, it's very dynamic and that's why you get statistics for deforestation that swing wildly from one year to the next," said Roberto Cavalcanti of Conservation International.

"A small shift in food prices can have a big impact on whether it's economical or not to move into the forest."

The governor of Mato Grosso, one of Brazil's biggest farming states, last week advocated more deforestation as a solution to the sharp rises in staples such as rice that are threatening to push millions of people into hunger.

"There is no way to produce more food without occupying more land and taking down more trees," Blairo Maggi, also Brazil's largest soybean producer and widely known as the "King of Soy", told the Folha news agency.

Brazil has become one of the world's breadbaskets, a leading exporter of foods such as soybean and beef, fuelled by strong demand from Europe and developing giant China.

The demand has helped feed the destruction of the world's largest rain forest for cattle ranching and crop production.

With up to 50 million hectares (193,000 sq. miles) in degraded farm land that could be reused -- an area bigger than California -- experts say Brazil could raise its farm production without making further inroads into the forest.

"We are trying to get farmers and producers to have access to new technologies so that they don't have to advance into new areas," Environment Minister Marina Silva said last week when asked about Maggi's comments.

But weak public policy and enforcement mean economics still work against the forest, which has shrunk by about a fifth -- an area the size of France -- since the 1970s.

"No-one (in the government) says how to recover that area, because in the Amazon basin it's more easy and cheaper to cut down trees than recover the degraded land," said Paulo Moutinho of IPAM, an Amazon research institute in Brasilia.

OPPORTUNITY

Cavalcanti said the fact that fuel prices were also rising meant the food crisis was an opportunity for governments in Brazil and elsewhere to encourage farming in areas away from forests, where productivity is often low and costs high.

"By providing incentives for the use of these degraded areas, you could redirect the pressure," he said.

Deforestation hit a record high in 2004 when commodity prices were high and Brazil's currency was weak.

About 7,000 square km (2,700 square miles) of the forest was lost between August and December last year, coinciding with a rise in global food prices and marking a sharp annualised increase after three years of declines.

In response, the government launched the "Arc of Fire", its biggest operation yet against illegal logging, which resulted in dramatic riots by loggers in Para state in February.

Hundreds of police and federal agents in the giant frontier states of Para, Mato Grosso and Rondonia have been deployed, imposing fines, making arrests and confiscating wood. But the vastness of the area alone makes slowing deforestation difficult.

Roberto Smeraldi, Amazon director of Friends of the Earth, said a preliminary study showed that less than 1 percent of the fines imposed during the operation had been collected.

A further 1,500 square km (580 square miles) of forest was cut down in the first three months of this year, according to preliminary figures from Brazil's National Institute for Space Research, a high figure considering it was the wet season.

"If there is no law enforcement ... the correlation between commodity prices and deforestation is high. If there is law enforcement you would see a correlation with increased productivity," said Carlos Nobre, a scientist with the institute and a leading Amazon expert.