AbstractMost deforested lands in Brazil are occupied by low-productivity cattle ranching. Brazil is the second biggest meat producer worldwide and is projected to increase its agricultural output more than any other country. Biochar has been shown to improve soil properties and agricultural productivity when added to degraded soils, but these effects are context-dependent. The impact of biochar, fertilizer and inoculant on the productivity of forage grasses in Brazil (Brachiaria spp. and Panicum spp.) was investigated from environmental and socio-economic perspectives. We showed a 27% average increase in Brachiaria production over two years but no significant effects of amendment on Panicum yield. Biochar addition also increased the contents of macronutrients, soil pH and CEC. Each hectare amended with biochar saved 91 tonnes of CO2eq through land sparing effect, 13 tonnes of CO2eq sequestered in the soil, equating to U$455 in carbon payments. The costs of biochar production for smallholder farmers, mostly because of labour cost, outweighed the potential benefits of its use. Biochar is 617% more expensive than common fertilizers. Biochar could improve productivity of degraded pasturelands in Brazil if investments in efficient biochar production techniques are used and biochar is subsidized by low emission incentive schemes.