December 12, 2005

Brazil to offer extra US$1.9 million loan to farmers

The state-owned Banco do Brasil, the chief farm lender in the country, said it would make an additional 4.2 billion real (US$1.9 million) available for the 2005-06 harvest.

The bank said in a press statement Thursday that the current loan package brings it closer to the 27 billion real it had projected for the 2005-06 harvest. The subsidized interest rate on the loans is 8.75 percent.

The real interest rate in Brazil of 18.5 percent is expected to drop to 18 percent on Dec 14 during the next monetary policy meeting of the central bank.

Banco do Brasil has lent 8.5 billion real since July, a value equal to the 2004-05 harvest, the bank said.

The loans are for the entire agriculture sector, from grain to livestock.