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However, this expansion of fast growing trees might not end in a win-win situation for both humans and the environment. In Laos, the cultivation of fast growing trees as eucalypts has been promoted due to a rapid decline in natural forest cover. Pathways to such sustainable outcomes are discussed. If parcel owners were able to overcome constraints to sustainability by, for example, transitioning from cattle ranching to agroforestry production, they could protect high levels (often upward of 90%) of the supporting ecosystem services provided by natural forest without sacrificing economically valuable provisioning services. All smallholder parcels included in the study but one lie far from the modeled efficiency frontier, indicating that for a given level of agricultural and forestry production, supporting services are not optimally conserved. Comparison of the empirical findings and the efficiency frontier indicates that current land use is inefficient relative to the biophysical optimum. I use this model first to predict ecosystem-service supply for 38 actual smallholder parcels in rural eastern Paraguay, and then to generate an efficiency frontier that illustrates the optimal trade-offs between provisioning and supporting services that are biophysically possible for the system. I represent multidimensional supporting services as a composite index of forest bird biodiversity, soil organic carbon content, and aboveground annual net primary productivity (NPP) relative to what would be expected in a stand of high-quality Atlantic Forest.

I represent provisioning services as the annual, per-ha proportion of a smallholder family's subsistence needs met by agriculture and forestry. The spatially implicit model simulates smallholder parcels as mosaics of subsistence agriculture, cattle pasture, eucalyptus plantations, and/or natural forest cover, and predicts provisioning and supporting service supply depending on the relative abundance of each land-use type per parcel. To explore such sustainable "win-win" outcomes, I present a model of predicted trade-offs of provisioning and supporting services on smallholder farms in eastern Paraguay. Yet, when land use is inefficient, managers may be able to increase provision of both economically and ecologically sustaining services.

The trade-off between economically critical provisioning services and environmentally sustaining supporting services often seems absolute. Understanding the evolving role of eucalypts in Eastern Paraguay is of critical importance to policymakers and foresters promoting sustainable management. Eucalypts are also integral to participants’ views on reforestation of deforested land and fit ambiguously into their concepts of reforestation and species’ nativeness. Producers have integrated agroforestry into eucalypt management and report replacing crop and cattle production with eucalypts in the mosaic of regional land-use. This study suggests that eucalypts play a complex, potentially sustainable role in the study area. Mixed methods analysis of a multiple-case study of 45 families was employed to describe the evolving ecological context of small-scale eucalypt forestry in Eastern Paraguay. The consequences of this recent, rapid change for smallholder land management remain uncharacterized. Smallholders, faced with the dilemma of accelerating environmental degradation juxtaposed with persistent economic need, have widely adopted eucalypt forestry due to the quick growth, low establishment cost and high commercial value of eucalypt plantations.

In Paraguay, changes in environmental policy, extension practices, and public perception of eucalypts (Eucalyptus spp.) have promoted a boom in plantation production of these species over the last 20 years. Despite claims that plantations both enhance and undermine the quality, valuation and protection of natural forests, plantation forestry continues to expand worldwide.