Risk Management in Brazilian Agriculture: Instruments, Public Policy, and Perspectives

The report examines Brazil's agricultural risk management landscape, focusing on public policies like PSR, PROAGRO, Garantia-Safra, and PGPM. It highlights a market characterized by high concentration, limited geographic reach, and a heavy reliance on soy insurance. The authors argue that inadequate risk management leads to underinvestment and inefficient land use, suggesting a shift in public funding from rural credit toward insurance and the expansion of market-based price risk instruments.

• Brazil's rural insurance market is highly concentrated, with only 14 insurers present in the 2019/20 agricultural year, and one company, Brasilseg Companhia de Seguros, holding a 52.3% market share.
• Access to crop insurance is geographically limited; in 2018, only 41.5% of Brazilian municipalities had crop insurance contracts according to SUSEP data.
• Crop insurance in Brazil is heavily dominated by soy, which accounted for 57% of the crop insurance premium volume in 2018.
• The Rural Insurance Premium Subsidies Program (PSR) primarily benefits small producers, who received 48.5% of the total subsidy in 2018, although less than 1% of all small producers in Brazil actually benefit from the program.
• The Agricultural Activity Guarantee Program (PROAGRO) has a broader geographic reach than PSR, covering 58.5% of municipalities compared to PSR's 38.2% in 2018, with a strong concentration in the Southern Region, particularly Rio Grande do Sul.
• Garantia-Safra provides a conditional benefit to family farmers in the semiarid region; in the 2016/17 agricultural year, it paid R$444.1 million to 522,425 producers who suffered losses.
• The Minimum Price Guarantee Policy (PGPM) has seen a significant decrease in expenditures, dropping to R$47 million in 2018 from a peak of R$4.4 billion in 2009, partly due to Brazilian currency depreciation since 2011.
• Agricultural Climate Risk Zoning (ZARC) has significantly reduced risks and provided savings of approximately R$16.8 billion for agribusiness in 2018.
• The Brazilian reinsurance market is highly concentrated, with IBR Brasil Resseguros S/A holding 69% of the market share in 2019, and two companies controlling over 80% of the market.
• Compared to other major agricultural producers, Brazil's crop insurance market is underdeveloped, with only 15% of its crop area insured, whereas the US, China, and India have rates of nearly 90%, 70%, and 40% respectively.

APA

Souza, P., & Assunção, J. (2020). Risk Management in Brazilian Agriculture: Instruments, Public Policy, and Perspectives. Climate Policy Initiative. https://www.climatepolicyinitiative.org/wp-content/uploads/2020/08/Report-–-Risk-Management-in-Brazilian-Agriculture.pdf

Chicago

Souza, Priscila, and Juliano Assunção. Risk Management in Brazilian Agriculture: Instruments, Public Policy, and Perspectives. Climate Policy Initiative, 2020. https://www.climatepolicyinitiative.org/wp-content/uploads/2020/08/Report-–-Risk-Management-in-Brazilian-Agriculture.pdf.

Wikipedia

{{cite report |last1=Souza |first1=Priscila |last2=Assunção |first2=Juliano |title=Risk Management in Brazilian Agriculture: Instruments, Public Policy, and Perspectives |publisher=Climate Policy Initiative |date=August 2020 |url=https://www.climatepolicyinitiative.org/wp-content/uploads/2020/08/Report-–-Risk-Management-in-Brazilian-Agriculture.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{souza2020risk, author = {Souza, Priscila and Assunção, Juliano}, title = {{Risk Management in Brazilian Agriculture: Instruments, Public Policy, and Perspectives}}, institution = {Climate Policy Initiative}, year = {2020}, month = aug, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2020/08/Report-–-Risk-Management-in-Brazilian-Agriculture.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }