By Raymond Colitt

BRASILIA, July 16 (Reuters) - Small community projects for picking fruits and nuts are the best way to alleviate poverty and protect the Amazon and other tropical forests, but are largely ignored by governments, a study showed on Monday.

Communities harvesting natural products generate more long-term income than many national parks or big timber companies, said a report by the International Tropical Timber Organization, or ITTO, released at a forestry conference in northeastern Brazil.

"Someone depending on a forest for income and habitat will look after it," said Andy White, one of the report's authors. "We need people in forests."

The 200-page report is based on 20 case studies on three continents, ranging from raising bees in Africa to making bamboo chopsticks in China.

The ITTO, an intergovernmental group promoting the conservation and trade of tropical timber, says communities living in the forest have a "longer time horizon for resource management" than big timber companies.

For example, in Nepal, the extraction of juice from the Bel tree by local communities is rejuvenating degraded forests and helping prevent unsustainable timber extraction, the report said.

Community forest management has increased in recent years with political decentralization and the recognition of historic land tenure rights in several countries. But such efforts must overcome red tape, competition from big business and government indifference, the study said.

In Brazil, local forest communities are often displaced by loggers, farmers and miners, and many lack the infrastructure to bring products to the market.

Rural workers and tribal Indians delivered a letter on Sunday to Brazilian Environment Minister Marina Silva, urging the government to come up with a policy and financial aid for community forest projects.

"If the government dedicated only a fraction of its farm aid to forestry management, you would see a conservation revolution in the Amazon," ITTO Executive Director Manoel Sobral Filho said.

Each year, country-sized chunks of the Amazon are burned or cut down by loggers, ranchers and speculators.

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