April 27, 2010

Brazil to boost farm aid by 7.5%

Brazil's government plans to boost farm lending for next year's crop by about 7.5% to almost BRL100 billion (US$57.3 billion), less than the amount sought by growers seeking protection against price declines.

The financing will be available to commercial farmers, who start planting in September, Agriculture Minister Wagner Rossi said. Last year, the government offered BRL93 billion in farm loans, the ministry said.

The government-aid package is less than Brazilian farmers are seeking after debt surged and a global credit crunch pared access to financing, according to Rosemeire Santos, a director at the National Agriculture Confederation.

Farmers want BRL146 billion of credit as higher production of soy, corn and other crops increase the need of stockpiling to avert price drops, Santos said.

The government is the main backer of crop financing in Brazil, the second-largest producer of soy.