BNDES extends R$4 billion dollar line to farmers; cooperatives will have R$2 billion more By Reuters

BNDES extends R$4 billion dollar line to farmers; cooperatives will have R$2 billion more By Reuters
BNDES extends R$4 billion dollar line to farmers; cooperatives will have R$2 billion more By Reuters
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© Reuters. Truck being loaded with soybeans in Luziania, Goiás. REUTERS/Adriano Machado/

SÃO PAULO (Reuters) – The National Bank for Economic and Social Development (BNDES) announced this Friday the expansion by 4 billion reais of the financing line for Brazilian rural producers, in a type of credit that can finance costs and investment , at a time when the rural sector is faced with lower food prices and crop failures in some regions.

In addition to expanding the dollar line, BNDES announced changes to the BNDES Procapcred program, which supports credit cooperatives, with an increase of 2 billion reais in the budget, expanded access for individuals and different rate and term conditions for the North and Northeast.

“The dollarized line was just an investment, and we opened it for funding… We are irrigating the economy, and we are putting resources into cooperatives”, said the president of BNDES, Aloizio Mercadante, to journalists during the announcement.

“The dollar line is oxygen during this period…” added Mercadante, noting that the resources should help the agricultural sector, since the new Harvest Plan should only be announced in the middle of the year.

Launched in April 2023, the BNDES Fixed Rate in Dollars (TFBD) offers a financing option with a cost linked to exchange rate variation, which is advantageous for farmers who have income linked to the dollar.

Within the scope of this line, the amount approved using the TFDB totaled 3.62 billion reais in 2023, from an initial available budget of 4 billion reais, according to the BNDES, this Friday.

The expansion of the line was announced at a time when the government is looking for ways to irrigate the agricultural credit market, as producers face lower soybean prices, in addition to a crop failure in several regions.

“We had bad weather, we had difficulties with flat commodity prices. We are alongside the producers, we are thinking about more lines of credit, more opportunities, so that we don’t let any producer sleep in uncertainty about how the future of their activity will be conducted” , said the Minister of Agriculture, Carlos Fávaro, during the event.

The day before, Fávaro told Reuters that the Brazilian government is evaluating the possibility of launching a financing line in Chinese currency, , for farmers.

Asked by a journalist this Friday about the possible line in yuan, Fávaro said that the matter has not yet reached the BNDES, but the government is looking at all scenarios, and that the proposal has a logic, since China is a large importer of Brazilian products.

“The export sector makes an advance on credit, this operation when carried out in yuan the interest rate is 2% per year, it is very attractive. Why then can we not think, for those who have specific exports to China, be able to carry out an operation in yuan?”, he commented.

Fávaro recalled that, although states like Rio Grande do Sul should have good production, others, like Mato Grosso, are dealing with the difficulties of the situation. But he guaranteed that “no one will remain in uncertainty and default due to lack of credit.”

(By Roberto Samora)

The article is in Portuguese

Tags: BNDES extends billion dollar line farmers cooperatives billion Reuters

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