January 23, 2009

Brazil's s government is expected to offer 2 billion Brazilian reals (US$864 million) in credit for Brazilian agricultural cooperatives in 10 to 15 days, a press officer at Brazil's Minister of Agriculture confirmed on Thursday (January 22).

The new credit should be offered to help the working capital of cooperatives during the upcoming harvest season, the press officer said.

Reinhold Stephanes, Brazil's Minister of Agriculture, said that the government is looking into at least five measures to help Brazil's coffee sector to recover losses in income from the previous 2007-08 crop, local news service Estado reported.

Measures are likely to include extending debt repayment deadlines for coffee producers until next year, Estado reported.

Stephanes also noted that the grain harvest including soy, wheat and corn, will drop between 7 percent and 8 percent in 2008-09 compared with 2007-08 due to the lower use of technology such as fertilizers, Estado reported.

The estimate is more pessimistic than the National Commodities Supply Corp. or Conab's latest estimate earlier in January of 137 million tonnes of grains in 2008-09, down 4.9 percent compared with 144 million tonnes in 2007-08.

Brazil is the world's No. 1 producer of coffee and sugar as well as the No. 2 producer of soy.