Government wants cheaper credit to agro with Dilma in Brics – 01/04/2023 – Market

The Minister of Agriculture and Livestock, Carlos Fávaro (PSD), said he intends to establish a partnership with the Brics bank, headed by former president Dilma Rousseff, to expand the offer of low interest credit to rural producers.

“Brazil has a good moment to capture money. It takes money from the Brics, and the BNDES and Banco do Brasil lend to investors, buying tractors, harvesting machines, building warehouses. Investments of five, six, seven years with lower rates. reduced. It’s a very safe operation for everyone,” he said in an interview with Sheet.

The minister also criticized the reaction to the statements by the president of the Apex (Brazilian Trade and Investment Promotion Agency), Jorge Viana, who during a seminar in China spoke about 84 million hectares deforested in the Amazon in the last 50 years, 67 million of which for livestock .

For Fávaro, the ruralist caucus, one of the most influential in Congress, acted in an electoral manner by classifying Viana’s speech as “irresponsible”.

What is your assessment of the trip to China? What is most important in my luggage since then is the feeling that the bonds of fraternity between Brazil and China are reestablished. For example, the clearance of Brazilian beef due to the atypical mad cow event took 29 days, while in 2021 it took more than 100 days. Four more slaughterhouses were qualified to export to China. I see the humor. It’s not just the speech. The possibility of closing deals between Brazil and China without going through the dollar. You don’t need someone in the middle of the process earning with the exchange rate.

What other measures should be announced during Lula’s visit? Electronic certification. We will no longer need paper, it will be done electronically. So remove the bureaucracy for everything. to enable [empresa para exportação] and when exporting, you also need a document. It will all be digital.

Why do you think the relationship with China changed? The respect. Our treatment. Our diplomacy. The numbers show this change. We also have good news in Mexico, Egypt, the beef market for Indonesia and we have expanded the pork market for Japan. The mood of the world turning its eyes to Brazil again.

And with the Brics? We are also working with the Brics to expand, now that the [ex-]President Dilma is presiding over the bank [dos Brics] there is an opportunity to finance the productive sector through [de parcerias com] BNDES and Banco do Brasil.

How would it work? Banco do Brasil already had a small operation and it was well accepted in the producer market, for raising funds in dollars for those who produce products that are hedged in dollars, such as soy, corn, cotton and beef. Then the interest rate is cheaper and this is a great opportunity. But these are things that the president still needs to align with Dilma.

What’s the point? The market took advantage of Banco do Brasil’s operation. There was a borrower and the interest is affordable. The Treasury does not need to equalize, therefore, it does not need public money to equalize interest rates, because interest rates are at international standards. Brazil has a good moment to capture. It borrows money from the Brics and the BNDES and Banco do Brasil, lending to investors, buying tractors, harvesting machines, building warehouses. Investments of five, six, seven years with lower rates. It is a very safe operation for everyone.

What would be the public, as there would be a great demand? We have to work for medium and large producers. We have to agree that a small producer does not yet have the ability to sell futures in dollars. But medium and large producers are already used to this. This leaves more resources from the Treasury for small producers.

The age Joesley and Wesley Batista, J&F executives, parent company of JBS, in the entourage caused noise in the government and in the trip? It is the largest food company in the world. It generates thousands of jobs for Brazilians. If the entrepreneur has not had a good procedure at some point, he pays for it. Resolve his life and now the life that follows. Why can’t you go there to expand your business and create more jobs, legally? Their presence did not cause any discomfort. [dentro do governo] and there wasn’t one among the businessmen who were there either.

The statements of President of Apex (Brazilian Trade and Investment Promotion Agency), Jorge Vianaon deforestation in amazon were criticized by the FPA [bancada ruralista do Congresso]. [Foi uma reação] voter. They didn’t come down from the podium. Jorge didn’t say anything else. He said that in some years Brazil had a complacent policy with the deforestation of the Amazon, illegal burnings. And it’s true. He showed that this government will not pass its hand on those who commit environmental crimes because everyone pays that price. The FPA exaggerated, it is still impregnated in the election. If you want to run, find another candidate in 2026 and run. Now we have to look forward. The agro businessmen who were there were not offended.

The bench also says that there was a weakening of the Ministry of Agriculture. This is another electioneering conversation. Conab will have shared management between Agriculture and Agrarian Development. This conversation makes no sense. The Crop Plan is made here [ministério da Agricultura]. The Rural Environmental Registry, yes, left the ministry and went to the Environment. I think it would be good to have this within Agriculture for producers to follow, but it is a rural environmental record and we are going to work on it together with Marina Silva [ministra do Meio Ambiente].

What about the Crop Plan 2023/2024? We are structuring. We will have news, dollarized lines of credit, new alternatives for investment. We will have more resources. I won’t say that we will have very cheap interest rates so it’s not our fault. The Treasury has limits on spending.

Agribusiness has criticized interest rates, tax reform and land invasions. We are opening up the market. Companies need to invest, but at this interest rate? It’s frustrating. This basic interest rate makes investment difficult. If we had an inflationary risk, if the public accounts were unbalanced, [eu entenderia]. Look… there’s a gesture [do governo]. Let’s be coherent with Brazil that wants to grow. The tax reform I still haven’t seen the proposal that will come to the table. The primary product cannot stand being taxed. It is food and is the primary base of the chain.

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Carlos Favaro, 53

Rural producer and Minister of Agriculture and Livestock. He was senator of the Republic for Mato Grosso, where he was vice-governor. He was vice-president of Aprosoja and directed the association in the state. One of Lula’s main interlocutors with the sector in the campaign, he coordinated the area’s transition group