Deforestation in Brazil's Amazon region fell to its lowest in 23 years in the year through July, the government said on Monday, attributing the drop to its tougher stance against illegal logging.

Destruction of the Brazilian portion of the world's largest rain forest dropped 11 percent to 6,238 sq km over the 12-month period, satellite data from Brazil's National Institute for Space Research showed.

That is less than a quarter of the forest area that was destroyed in 2004, when clear-cutting by farmers expanding their cattle and soy operations reached a recent peak.

Brazil has stepped up its monitoring and enforcement policies in the Amazon in recent years but the improvement has partly been driven by slower global economic growth that has reduced demand and prices for the country's farm produce.

Overall improvement in 2010/11 masked worrying rises in some Amazon states such as Rondonia, where deforestation doubled from the previous year. Forest clearing in the farming state of Mato Grosso rose 20 percent.

"Some states are still extremely sensitive," Environment Minister Isabel Teixeira told reporters.

"Rondonia needs to be clarified, we need to understand what has caused the change in its profile," he said.    

Two large hydroelectric dams are being built in Rondonia, boosting the local economy and attracting migrant workers.

The drop in deforestation comes as Brazil's Congress debates an overhaul of the land law that environmentalists say would severely set back conservation efforts. The Senate is expected to approve the new forest code in the coming days.

Brazil's influential farming lobby says the reform, which would ease conservation requirements for land owners, is needed to end widespread uncertainty over the current regulations that farmers say is a burden on production. – Reuters