ANNOUNCEMENT 02 Jun 2016

The Brazilian Government launched the 2016/2017 Agricultural and Livestock Plan allocating credits lines with lower interest rates than those set at the market for farmers. The total budget for the 2016/2017 plan was BRL 185 billion (circa USD 51.6 billion). In comparison with the 2015/2016 plan, the total budget has decreased by approximately 1.5%.

NUMBER OF INTERVENTIONS

9

  • 6 harmful
  • 0 neutral
  • 3 liberalising

SOURCE

Ministry of Agriculture, Livestock and Farming. Ministério da Agricultura, Pecuária e Abastecimiento. "Plano Agrícola e Pecuário". Available at: http://www.agricultura.gov.br/assuntos/sustentabilidade/plano-agricola-e-pecuario/plano-agricola-e-pecuario-antigo

United States Department of Agriculture. Foreign Agricultural Service. "Brazil: Brazil Raises Agriculture Credit Budget by 20 Percent". Available at: https://gain.fas.usda.gov/Recent%20GAIN%20Publications/Brazil%20Raises%20Agriculture%20Credit%20Budget%20by%2020%20Percent_Brasilia_Brazil_6-3-2015.pdf

Inception date: 01 Jul 2016 | Removal date: 30 Jun 2017

State loan

On July 1, 2016, the Brazilian Government launched the 2016/2017 Agricultural and Livestock Plan. The plan allocated BRL 149.8 billion (over USD 46 billion at the time of the launch) in the form of rural credits for commercialisation and marketing, hence decreasing the budget when compared to the 2014-2015 that amounted BRL 147.5 billion (circa USD 45.5 billion)

AFFECTED PRODUCTS

 
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Inception date: 01 Jul 2016 | Removal date: 30 Jun 2017

State loan

In the 2016/2017 Agricultural and Livestock Plan, launched by the government of Brazil on July 1, 2016, the total budget allocated to the PRODECOOP program was also increased. The new budget was set at BRL 2,430 million (over USD 749.5 million) while the budget provided in the previous Plan was BRL 1,600 million (over USD 493.5 million). 

This regime consists of credit lines provided by the National Bank for Economic and Social Development of Brazil (i.e. BNDES by its acronym in Portuguese) to finance projects that seek the modernization of production systems and commercialization of the agro-industrial complex of Brazilian cooperatives.

The annual interest rate offered to these credit lines in this edition is 9.5%.

 
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Inception date: 01 Jul 2016 | Removal date: 30 Jun 2017

State loan

The total budget allocated in the 2015/2016 Agricultural and Livestock Plan launched on July 1, 2016, to the MODERFROTA program was also increased. The new budget was set at BRL 5.05 billion (circa USD 1.6 billion) while the budget provided in the previous Plan was BRL 3.65 billion (over USD 1.1 billion). 

These credit lines managed by the BNDES are intended to financing the acquisition of tractors, harvesters, cutting platforms, sprayers, planters, seeders and equipment, both to rural producers and to cooperatives.

 
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Inception date: 01 Jul 2016 | Removal date: 30 Jun 2017

State loan

Likewise, the 2016/2017 Agricultural and Livestock Plan launched on July 1, 2015, by the Brazilian government, decreased the budget for the Program MODERAGRO. The new budget was set at BRL 640 million (over USD 197.4 million) while the budget provided in the previous plan was BRL 400 million (circa USD 123.4 million).

This program managed by the BNDES, has the objective to provide financing for the incorporation of technological innovations in rural properties, aiming at increasing productivity and improving management.

 
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Inception date: 01 Jul 2016 | Removal date: 30 Jun 2017

State loan

Furthermore, the Brazilian Ministry of Agriculture announced an increase in the budget of the MODERINFRA Program enclosed on the 2016/2017 Agricultural and Livestock Plan. The new budget was set at BRL 550 million (circa USD 169.7 million) while the budget provided in the previous Plan was BRL 290 million (USD 89.5 million).

 
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Inception date: 01 Jul 2016 | Removal date: 30 Jun 2017

State loan

On the contrary, the Brazilian 2016/2017 Agricultural and Livestock Plan announced on July 1, 2016, also decreased the budget allocated to the Agricultural Carbon Reduction Program (i.e. ABC by its acronym in Portuguese). The new budget was set at BRL 2,990 million (over USD 922.3 million) while the budget provided in the previous Plan was BRL 3,000 million (over USD 925.4 million). 

The ABC Program was created based on a voluntary commitment made by Brazil at the UN Conference on Climate Change Conference and aims at promoting environmentally sustainable crops. The Program's priorities are the recovery of degraded areas and pastures, control of commercial forestry and treatment of waste.

 
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Inception date: 01 Jul 2016 | Removal date: 30 Jun 2017

State loan

Likewise, the Brazilian 2016/2017 Agricultural and Livestock Plan launched on July 1, 2016, also decreased the budget for the PRONAMP investment credit lines managed by the BNDES. The new budget was set at BRL 4,240 million (over USD 1,307.9 million) while the budget provided in the previous Plan was BRL 5,290 million (over USD 1,631.8 million). 

The PRONAMP credit lines are intended to finance individual or collective investment projects directly related to the productive activity of the medium rural producer. These investments include construction, renovation or expansion of improvements and permanent installations; irrigation works, dams, drainage; afforestation, reforestation and deforestation; rural electrification and telephony; purchase of animals for breeding, breeding or service; and acquisition of equipment used in the measurement of crops amongst others.

 
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Inception date: 01 Jul 2016 | Removal date: 30 Jun 2017

State loan

Moreover, the total budget allocated to Inovagro and included in the Brazilian 2016/2017 Agricultural and Livestock Plan launched on July 1, 2016, was also decreased. The new budget was set at BRL 1,245 million (384 million) while the budget provided in the previous plan was BRL 1,400 million (circa USD 431.9 million). 

This program managed by the BNDES, has the objective to provide financing for the incorporation of technological innovations in rural properties, aiming at increasing productivity and improving management.

 
N/A
Inception date: 01 Jul 2016 | Removal date: 30 Jun 2017

Interest payment subsidy

Finally, the 2016/2017 Agricultural and Livestock Plan launched by the Brazilian government on 1 July 2016, also increased the budget for the interest payment subsidy applied to the Rural Insurance Program. The new budget was set at BRL 399 (USD 123 million) while the budget provided in the 2015/2016 Agricultural and Livestock Plan reached BRL 282 million (circa USD 87 million).

 
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