Palmito sustainability and economics in Brazil's Atlantic coastal forest

A number of palm species produce edible palm hearts, or 'palmito' as it is called in Brazil. Palmito jussara (Euterpe edulis) is a favorite for both international export and Brazilian consumption. Except on private lands, extraction of wild jussara palmito (or just 'palmito') from Brazil's Atlantic Coastal Forest is illegal. Yet palmito extraction in this forest continues on a large scale because of profitability for palmito processors and merchants, ineffective government intervention, and relatively attractive earnings for low-income palmito harvesters ('palmiteiros'). Because most palmito cutting and transport is clandestine, virtually no information is available on the financial returns from palmito extraction. However, the question is central for discussions of sustainability in unmanaged vs. managed agro-ecological systems. While reliable data are impossible to obtain, we interviewed several individuals in Brazil in order to formulate scenarios of palmito production, prices, and costs. We simulate the uncertainties in assumptions and data to generate a range of estimates on the net value of palmito management alternatives. Financial net present value (NPV) of palmito extraction is highly sensitive to the time value of money (discount rate). 'Managed' extraction is more attractive than unmanaged extraction at low discount rates. As the discount rate increases, the attractiveness of sustainable palmito management decreases. All scenarios suggest that palmito cutting is very lucrative, explaining current institutional problems in controlling its commerce.