This paper examines the competing claims on land use resulting from the expansion of biofuel production. Sugarcane for biofuel drives agrarian change in So Paulo state, which has become the major ethanol-producing region in Brazil. We analyse how the expansion of sugarcane-based ethanol in So Paulo state has impacted dairy and beef production. Historical changes in land use, production technologies, and product and land prices are described, as well as how these are linked to changing policies in Brazil. We argue that sugarcane/biofuel expansion should be understood in the context of the dynamics of other agricultural sectors and the long-term national political economy rather than as solely due to recent global demand for biofuel. This argument is based on a meticulous analysis of changes in three important sectors - sugarcane, dairy farming, and beef production - and the mutual interactions between these sectors.
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