May 28, 2009

Cargill will allocate between US$500 million and US$550 million to help finance producers during the 2009-10 crop season in Brazil, local newspaper Valor Economico reported Wednesday (May 27).

Cargill invested US$400 million in the 2008-09 crop season, Valor reported Jose Luiz Glaser, director at a Cargill soy plant, as saying.

"Whether the full amount will be used depends on the demand from producers," he said.

Cargill this crop season intends to broaden its funding to some 1,500-2,000 Brazilian producers. Cargill last year chose to make fewer loans but with a higher value because of the soaring costs of inputs such as fertiliser, the newspaper reported.

Cargill was unavailable for further comment.

The funding from companies such as Cargill is vital for many farmers especially in soy regions such as Mato Grosso, the No. 1 soy producing state, where farmers have racked up large debts over the years. As a result, they need support from large trading companies to acquire fertilizer, seeds or equipment.

Brazil is the No. 2 producer of soy worldwide.