Credit for investments in Brazilian agriculture and the role of the Brazilian Development Bank

The document examines the role of BNDES in Brazil's agricultural investment credit, highlighting a significant increase in disbursements between 1995 and 2020. It details the bank's credit structure, noting a predominance of indirect loans and a focus on crop activities, particularly soy. The analysis reveals that credit for equipment is concentrated in the Midwestern region and primarily operated by private financial agents, such as banks owned by machine manufacturers, which contrasts with the broader Brazilian rural credit market dominated by public banks.

• BNDES disbursements to the rural sector grew significantly between 1995 and 2020, nearly quadrupling in real terms due to government efforts to modernize Brazilian agriculture.
• BNDES credit is primarily directed toward crop activities rather than cattle production, with soy being the leading agricultural product for machinery and equipment financing; soy's share of this credit rose from approximately 30% in 2008 to 61% in 2018.
• Harvesting equipment and tractors are the most financed items, representing 32% and 28% of the total rural credit volume for equipment in 2018, respectively.
• Geographic distribution of equipment credit has shifted toward the Midwestern region, which reached a 36% share of all such credit in 2018, reflecting the expansion of the agricultural frontier.
• Unlike general rural credit in Brazil, which is mostly operated by public banks (with Banco do Brasil operating 45% in 2018), BNDES credit for equipment is dominated by private agents, specifically banks owned by machine manufacturers (55%) and private commercial banks (35%) as of 2018.
• The vast majority of BNDES rural credit is provided through the indirect modality, where funds are transferred to other financial institutions, accounting for 99% of the credit volume in 2020.
• The ABC Program is specifically identified as a mechanism to support investments that reduce environmental impacts, such as curbing greenhouse gas emissions and adopting sustainable practices.

APA

Climate Policy Initiative (2021). Credit for investments in Brazilian agriculture and the role of the Brazilian Development Bank. https://www.climatepolicyinitiative.org/publication/credit-for-investments-in-brazilian-agriculture-and-the-role-of-the-brazilian-development-bank/

Chicago

Climate Policy Initiative. Credit for investments in Brazilian agriculture and the role of the Brazilian Development Bank. 2021. https://www.climatepolicyinitiative.org/publication/credit-for-investments-in-brazilian-agriculture-and-the-role-of-the-brazilian-development-bank/.

Wikipedia

{{cite report |author=Climate Policy Initiative |title=Credit for investments in Brazilian agriculture and the role of the Brazilian Development Bank |date=9 December 2021 |url=https://www.climatepolicyinitiative.org/publication/credit-for-investments-in-brazilian-agriculture-and-the-role-of-the-brazilian-development-bank/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatepolicyinitiative2021credit, author = {{Climate Policy Initiative}}, title = {{Credit for investments in Brazilian agriculture and the role of the Brazilian Development Bank}}, institution = {Climate Policy Initiative}, year = {2021}, month = dec, url = {https://www.climatepolicyinitiative.org/publication/credit-for-investments-in-brazilian-agriculture-and-the-role-of-the-brazilian-development-bank/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }