ANNOUNCEMENT 22 Jun 2009
The Government of Brazil launched the 2009/2010 Agricultural and Livestock Plan allocating credits lines with lower interest rates than those set at the market to farmers. The total budget for the 2009/2010 Plan was BRL 107.5 billion (circa USD 53.35 billion). In comparison with the 2008/2009 plan, the total budget has increased by 37%.
NUMBER OF INTERVENTIONS
Ministry of Agriculture, Livestock and Farming. Ministério da Agricultura, Pecuária e Abastecimento. Plano Agrícola e Pecuário 2009/2010. Available at: http://www.agricultura.gov.br/assuntos/sustentabilidade/plano-agricola-e-pecuario/arquivos-pap/plano_agricolola_2009_2010.pdf
On June 22, 2009, the Brazilian Government launched the 2009/2010 Agricultural and Livestock Plan. The plan allocated circa BRL 66.2 billion (circa USD 32.9 billion) in the form of rural credits, which represents a 20.8% increase when compared to the budget of 2008/2009 Plan.
These loans enjoyed an annual 6.75% interest, and are divided into credits for commercialisation and marketing, for investments and for a Special Line of Credit (LEC) created to support the commercialization of products derived from apple, peach, mango, guava, passion fruit and pineapple.
The government of Brazil also created a new Program called PROCAP AGRO and enclosed it in the 2009/2010 Agricultural and Livestock Plan launched on June 22, 2009. The new budget for this program was set at BRL 2 billion (circa USD 992.3 million).
The purpose of this program is to promote the recovery or restructuring of agricultural, agroindustrial, aquaculture and fishing cooperatives. The capital can be used to pay shares or working capital, being limited to BRL 25,000 per member, provided that it does not exceed the limit of BRL 50 million per cooperative in the case of shares, whereas, for working capital, the limit was set at BRL 50 million per cooperative deducted from the financing limit for payment of quota shares.
These credit lines enjoy an annual interest rate of 6.75%.
Furthermore, the government of Brazil also increased the budget for the investment Program PRODUSA enclosed in the 2009/2010 Agricultural and Livestock Plan launched on June 22, 2009. The new budget was set at BRL 1,500 million (circa USD 744.4 million) while the budget provided in the 2008/2009 Agricultural and Livestock Plan was BRL 1,000 million (circa USD 496.3 million). This program aims to stimulate the recovery of areas destined to agricultural production but, although still productive, offer below-average performance physical deterioration or soil fertility.
The National Bank for Economic and Social Development of Brazil (i.e BNDES by its acronym in Brazilian) is the institution providing the financing of these loans.
Moreover, the 2009/2010 Agricultural and Livestock Plan launched on June 22, 2009, by the government of Brazil also increased the budget for the PRODECOOP credit lines. The new budget was set at BRL 2 billion (circa USD 992.6 million) while the budget provided in the 2008/2009 Agricultural and Livestock Plan was BRL 1 billion (circa USD 496.3 million).
This credit line aims at increasing the competitiveness of agro-industrial complex of cooperatives through the modernization of production systems and commercialization. The interest rate set for this credit lines is 3% with a credit limit of BRL 50,000 (approx. USD 24,800) per beneficiary.
Finally, the Brazilian government also increased the budget for the Proger Rural credit lines included in the 2009/2010 Agricultural and Livestock Plan launched on June 22, 2009. The new budget was set at BRL 500 million (approx. USD 248 million) while the budget provided in the 2008/2009 Agricultural and Livestock Plan was BRL 200 million (circa USD 99.3 million).
In addition, in this new edition, the income limit has increased from BRL 250,000 (USD 124,000) to BRL 500,000 (USD 248,000).