Safra Plan must have more than R$ 400 billion, says Fávaro – 06/22/2023 – Market

The Minister of Agriculture, Carlos Fávaro, assessed this Thursday (22) that the estimated amount for financing in the 2023/2024 Crop Plan will exceed R$ 400 billion and signaled an expansion in credit lines aimed at grain storage, since that the country faces a deficit of silos due to the record harvest.

“I think it will [ultrapassar R$ 400 bilhões]. I’m going to settle what needs to be fixed, which are the last details and the awards for good sustainability practices carried out by Brazilian producers”, said Fávaro in an interview with journalists at the Ministry of Finance, after meeting with secretaries of the portfolio.

Last week, Reuters published, based on a proposal that was being discussed in the government, that the Crop Plan could have a reduction of up to two percentage points in the interest of the National Support Program for Medium Producers (Pronamp), to up to 6% per year. year, if the farmer follows sustainable practices. Fávaro did not confirm when asked.

The minister pointed out that the plan will establish investments in the storage of grains, and that there will also be an expansion of the “innovative” lines of rural financing from the National Bank for Economic and Social Development (BNDES) for agricultural producers who have income in dollars or linked to US currency.

“Grains, soybeans, corn and wheat are quoted in dollars, so there is no exchange rate risk… The line of credit for warehouses will also be expanded,” he said.

The line for those who have receivables in dollars has a fixed interest rate of 7.59% per year, plus the exchange variation. It was announced in April. In May, the government announced that it would double the resources of the line, initially with availability of R$ 2 billion, due to the high initial demand.

The minister said that the total value of the plan has already been agreed upon and approved by President Luiz Inácio Lula da Silva, and that any negotiations before the announcement will not be focused on this aspect.

“The discussion here is no longer about the size of the Safra Plan. This has already been defined. Before President Lula travels on Monday, that day we agreed on the size of the Safra Plan, the value that will be achieved… Everything is in place. closed, numbers all closed,” he said.

The Ministry of Agriculture has discussed with the Ministry of Finance ways to obtain more resources from the Treasury to equalize interest rates, with the aim of offering lower rates to farmers.

Lula and the Minister of Agriculture will announce the details of the 2023/2024 Crop Plan next Tuesday, the ministry informed the day before.