Volume of credit granted for 2022/23 Crop Plan between July last year and May this year grew by 18% compared to previous cycle
Paulo Teixeira — Foto: Wenderson Araujo
For the first time, the volume of rural credit granted in the 2022/23 Crop Plan, from July last year to May this year, exceeded the R$300 billion mark. The record disbursements of the 11 months reached R$317.2 billion, 18% more than in the same period of the previous season, according to data from the Central Bank consulted on June 5 and compiled by Valor.
The amount is also 8% higher than the consolidated financing for the entire 2021/22 cycle, when it was R$293.4 billion, according to the report released at the time by the Ministry of Agriculture. Of the amount disbursed until May of this year, R$86.7 billion came from lines with compensation from the National Treasury.
The crop loan operations led to the disbursements of this harvest. In 11 months, R$188.1 billion was granted, almost 34% more than the R$140.5 billion granted between July 2021 and May 2022. Despite the scarcity of funds to subsidize the equalized investment lines, which were blocked for most of this season, the financing in this modality advanced 5% in comparison with the previous cycle, going to R$83.8 billion from R$79.8 billion.
The pace is even slower in the commercialization and industrialization operations, which have had disbursements of R$30.7 billion and R$14.5 billion, respectively, since July 2022.
The performance of rural credit in May has already been counted with the reinforcement of the new equalable limit distributed in the last week of the month, as a result of the budgetary supplementation of R$200 million to subsidize the financing lines of the 2022/23 Crop Plan. Banco do Brasil (BB), Brazilian Development Bank (BNDES), and Caixa were authorized to lend almost R$7.5 billion with equalization.
At Banco do Brasil, the release started in May. As a result, the amounts disbursed by the market leader reached R$176 billion by the end of last month, including the amounts lent through agribusiness bonds.
At Caixa, more than half of the R$1 billion available to Moderfrota [the main credit line for investments in the Crop Plan] the purchase of agricultural machinery and equipment has already been used in the first week that the line has been open.
According to the Ministry of Agriculture, R$27.59 billion of equalable controlled funds and R$19.75 billion of free resources were still available for loans in the 2022/23 Crop Plan on May 22nd. The initial program for the plan was R$340.88 billion.
No date has been set for the announcement of the 2023/24 Crop Plan. Agriculture Minister Carlos Favaro is working to have more than R$400 billion of funds available for the contracts of medium and large producers, but it would need a budget of R$18.5 billion for the equalization of interest rates, but the economic team is having difficulties to meet the request.
For this cycle, R$12.4 billion have been planned for the equalization of the interest rates, of which R$8.6 billion for family agriculture and R$3.8 billion for medium and large producers, distributed over several years.
Mr. Favaro’s team is developing guidelines to link the granting of credit with the adoption of sustainable practices in the rural areas. The goal is to offer a reduction of up to 3 percentage points in the final interest rates on the financing lines of the 2023/24 Crop Plan for those who apply environmentally correct techniques in production, such as direct planting, the use of bio-inputs and integrated production systems, as well as social and economic criteria.
The Agrarian Development Minister Paulo Teixeira plans similar actions for the Crop Plan of family farming. The goal is to stimulate, through more attractive interest rates, the production of foods that make up the basic food basket or that go directly to the consumer’s table, such as rice, beans, manioc, and vegetables.
The expectation among family farming entities is that the National Program to Strengthen Family Farming (Pronaf) will have more than R$ 70 billion in credit in the 2023/24 Crop Plan. But it is still difficult to predict the scenario for next season. To have this volume of financing, most of it subsidized, the sector would demand an increase in the equalization budget, to more than R$14 billion from the current R$8.6 billion.
“The financial cost of the economic subsidy to the credit, added to the high costs with the Agricultural Activity Guarantee Program (Proagro), which has a forecast of more than R$5.8 billion for 2023, depending on the winter harvest in southern Brazil, complicates the planning of the harvest,” said source familiar with the discussions.
*Por Rafael Walendorff — Brasília
Source: Valor International