ANNOUNCEMENT 18 Feb 2014

The Brazilian government increased to BRL 3,825 million the total budget allocated to the Coffee Economy Defense Fund credit lines known as "Funcafé".

NUMBER OF INTERVENTIONS

2

  • 2 harmful
  • 0 neutral
  • 0 liberalising

SOURCE

Government of Brazil. Governo do Brasil. "Conselho define proposta de distribuição do Funcafé" Available at: http://www.brasil.gov.br/economia-e-emprego/2014/02/conselho-define-proposta-de-distribuicao-do-funcafe

Brazilian Central Bank. Banco Central do Brasil. Resolçao 4229 de 1 de Junho de 2013. Available at: http://www.bcb.gov.br/pre/normativos/busca/downloadNormativo.asp?arquivo=/Lists/Normativos/Attachments/48929/Res_4229_v1_O.pdf

Inception date: 18 Feb 2014 | Removal date: 02 Jun 2015

State loan

On 18 February 2014, the National Monetary Council (CMN by its acronym in Portuguese) approved BRL 3,575 million (USD 1,495 million) for credit lines enclosed in the Fund for the Defense of the Coffee Economy ("Funcafé") for 2014. The new budget represents an increase when compared to 2013 when the total budget was BRL 3,160 million (circa USD 1,322 million).

The credit lines were distributed as it follows:

  • BRL 845 million for funding;
  • BRL 1,300 million for storage;
  • BRL 500 million for Coffee Acquisition Financing (FAC); 
  • BRL 10 million for options contracts and operations;
  • BRL 20 million for the recovery of damaged coffee plantations;
  • BRL 900 million for working capital limited to BRL 200 million for the soluble coffee industry, BRL 300 million for the coffee roasting industry and BRL 400 million for production cooperatives.

These amounts apply for the 2014 harvest.

AFFECTED SECTORS

 
Inception date: 18 Feb 2014 | Removal date: 31 Dec 2014

Trade finance

The National Monetary Council of Brazil also approved on 18 February 2014 the distribution of BRL 250 million (USD 104.5 million) in credit lines to finance coffee exports as part of the Fund for the Defense of the Coffee Economy ("Funcafé"). In the previous edition of this fund, there were no provisions related to the financing of coffee exports.

This export assistance applied for the 2014 harvest.