Alexandre Abreu says aid is being built in collaboration with the Ministry of Agriculture in a scenario of falling productivity and prices
BRASÍLIA – The financial director of the National Bank for Economic and Social Development (BNDES), said Alexandre Abreu Estadao that the solution to the current difficulties of agribusiness comes through the renegotiation of rural producers’ debts.
“The government has identified some areas where productivity has fallen heavily due to bad harvests. There is also a problem with prices, especially soybeans. I don’t have the solution yet, but it certainly involves some sort of debt renegotiation that have (producers) taken in the past,” said Abreu, who is participating in talks with the Ministry of Agriculture.
This Tuesday, the minister Carlos Favaro met the head of the economic team, Fernando Haddad, to discuss relief measures against a backdrop of declining grain production, stable prices and high production costs. According to Fávaro, any financing renegotiation measures will be structured after the Treasury has made a diagnosis of the situation in the sector.
The announcement should take place on Friday 2nd, when Fávaro will meet the president of the BNDES, Aloizio Mercadante, in Rio de Janeiro.
In addition to the debt renegotiation, the development bank is expected to announce a new contribution of R$4 billion to the rural credit line with a fixed dollar cost, according to information from Broadcast Agro. There is also discussion of the creation of adollarized line for agricultural financing, with resources going directly to producers affected by bad harvests or resales to refinance costs.
For producers who do not have an export profile, the government is studying with BNDES the creation of another type of credit in reais.
Cooperatives
In the context of rural credit, Abreu highlights the importance of credit cooperatives, which already account for 59% of all BNDES financing for the sector. “Cooperatives already represent 30% of bank transfers. If we only consider rural credit, it reaches 59%”, he says.
Last year, the development bank granted R$24 million through cooperatives, an increase of 63%. The data is part of the final budget for 2023, expected in March, and has been brought forward Estadao.
“They have a very different working philosophy from that of the big banks. In recent years, for example, they have opened branches quite significantly. Today only one cooperative already has more branches than the largest traditional Brazilian bank”, underlines Abreu, when asked about the question the reasons for this significant increase last year. He also attributes the movement to the Central Bank’s actions, focusing on increasing competition.
Currently, BNDES has nine accredited credit cooperative banks, of which the four largest are mainly concentrated in the Southern region and rural areas. “We think that their next frontier will be the Northeast, which is still not very present,” says Abreu, also underlining the movement of expansion towards the urban sector.
Source: Terra
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