IMPLEMENTATION LEVEL

National

AFFECTED FLOW

Inflow

ANNOUNCED AS TEMPORARY

No

NON-TRADE-RELATED RATIONALE

No

ELIGIBLE FIRMS

all

JUMBO

No

TARIFF PEAK

No
← back to the state act
Inception date: 17 Oct 2013 | Removal date: 16 Dec 2013
Still in force

Production subsidy

On 17 October 2013, the government of Brazil stated that grapes of the harvest 2012/2013 are going to be subsidized with USD 16.1million(35 million real).
 
The stated amount will be distributed through the Brazilian farmer income support programs PEP and PEPRO. Both programs are based on the auction mechanism further described below. The subsidies will continue until the stated volume has been allocated completely.
 
The programs constitute a production subsidy to Brazilian farmers. Both domestic and international sales are eligible for the subsidy.
 
The design of the Brazilian farmer income support programs can be briefly summarized as follows:

  • PEP / Program for Product Outflow (Premio para Escoamento do Produto): The government first sets a minimum price for the eligible products. The government then auctions off a premium to buyers of the products on the condition that they pay the minimum price to the producers. The buyer submitting the smallest premium wins the right to receive the payment.
  • PEPRO / Premium Paid to Growers (Premio Equalizador Pago ao Produtor): The government first sets a minimum price for the eligible products. The government then auctions off a premium to the producers. The selling price represents the difference between the reference price and the premium reached at the auction. The farmer submitting the smallest premium wins the right to receive the payment.

 
The GTA includes state guarantees and other financial incentives that are likely to affect the restructuring and performance of firms facing international competition, whether from imports, in export markets, and from foreign subsidiaries.

AFFECTED COUNTRIES

MAP
TABLE
EXPORT

AFFECTED SECTORS AND PRODUCTS

013 Fruits & nuts
0806 Grapes, fresh or dried.
080610 Fresh
214 Prepared & preserved fruits & nuts
0806 Grapes, fresh or dried.
080620 Dried

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