Safra Plan: interest rates should remain high with restrictions in the Budget
On the eve of the announcement of the 2026/27 Harvest Plan, scheduled for this Tuesday (30), LEK Consulting analyst, Eric Emiliano, stated that the program's interest rates should still remain at a high level given the financial situation faced by rural producers. According to him, the sector would need more favorable financing conditions, but the government's budget limitations reduce the margin for a more significant drop.
"We would need more. The producer is not being able to pay the bills for past harvests, he is heavily in debt. The interest rate is still very high. But, with all the limitations we have in the government budget, it is difficult for us to be able to exceed that number", he said in an interview with CNN Agro News.
Emiliano also highlighted that default, which was 3% historically, is more than 15% for some banks, reaching close to 20% of the portfolio.
For the analyst, given this scenario, the agribusiness chain will continue to resort to other sources of financing in addition to official credit. In the analyst's assessment, although the Safra Plan maintains an important role in financing agricultural production, it no longer meets the sector's needs on its own.
According to him, banks, cooperatives, trading companies and the capital market have increased their participation in the supply of rural credit.
"We increasingly see the participation of banks, other agents in the chain, such as capital markets, trading companies and cooperatives, gaining space to help producers. The Safra Plan itself, still growing, does not deliver everything that agriculture needs", he said.
Emiliano stated that the increase in demand for financing boosted the development of private credit instruments, such as LCAs (Agribusiness Letters of Credit), Fiagros (Investment Funds in Agroindustrial Production Chains) and CPRs (Rural Product Notes). "Even though the Safra Plan is growing above inflation, it still falls short of the needs we have in agriculture and, therefore, these letters and financing have been growing", he stated
He also highlighted the growth of cooperatives in financing rural activities. According to estimates by LEK Consulting, the participation of these organizations in agribusiness GDP increased from around 8% to 15% in the last five or six harvests.
According to Emiliano, this progress is linked to the proximity of cooperatives to producers and the ability to respond more quickly in times of crisis.
When commenting on the increase in the share of resources allocated to funding in relation to investments, the analyst classified the movement as a "yellow signal". He added that reducing space for investments could compromise the long-term planning of the activity.
"The investment is not annual, there is an investment to have a long-term return. When we don't look at the multi-year perspective, we end up losing this long-term vision and the investment losing a lot of share over time", he stated.
Source: CNN