The Impact of Brazil's ABC Program Credit on Pasture Recovery: Evidence from the Cerrado

This report by the Climate Policy Initiative evaluates the effectiveness of Brazil's ABC Recuperação credit line in recovering degraded pastures, focusing on the Cerrado biome. Using satellite imagery and econometric analysis of operations between 2016 and 2018, the study finds that the credit's impact on pasture recovery is modest, with severe degradation remaining largely unchanged and some pasture being converted to crops rather than recovered. The report highlights the critical role of technical assistance and soil type in achieving results and suggests that the program contributed minimally to the ABC Plan's 2020 recovery targets.

• The overall impact of ABC Recuperação credit on pasture recovery is modest, with no significant effects observed in pastures showing the most severe signs of degradation (low quality).
• Obtaining credit is associated with a small average reduction of 3 percentage points in total pasture area, which is primarily driven by the conversion of medium and high-quality pastures to other economic uses, such as soybean cultivation and crop-cattle mosaics.
• Technical assistance is a critical factor for success; polygons with credit contracts that included technical assistance saw a significant reduction of 6 percentage points in degraded pasture area after four years, whereas quality remained unchanged for those without such services.
• The effectiveness of pasture recovery varies by soil type, with the strongest results in reducing degraded pastures occurring in areas where Plinthosols predominate, particularly in Mato Grosso, Tocantins, and Maranhão.
• Evidence indicates that areas declared for pasture recovery often experienced deforestation in the six years prior to receiving credit, though this trend slowed down after the credit was issued.
• The ABC Recuperação credit contributed very little to the ABC Plan's target of recovering 15 million hectares of degraded pasture by 2020, with an estimated contribution of at most 2.5% when accounting for pasture conversion.
• A significant portion of the areas declared for credit did not actually consist of pasture at the time of issuance, with more than 25% of declared areas not corresponding to pasture.

APA

Oliveira, W., Souza, P., & Assunção, J. (2024). The Impact of Brazil's ABC Program Credit on Pasture Recovery: Evidence from the Cerrado. Climate Policy Initiative. https://www.climatepolicyinitiative.org/wp-content/uploads/2024/08/Report-The-Impact-of-Brazils-ABC-Program-Credit-on-Pasture-Recovery.pdf

Chicago

Oliveira, Wagner, Priscila Souza, and Juliano Assunção. The Impact of Brazil's ABC Program Credit on Pasture Recovery: Evidence from the Cerrado. Climate Policy Initiative, 2024. https://www.climatepolicyinitiative.org/wp-content/uploads/2024/08/Report-The-Impact-of-Brazils-ABC-Program-Credit-on-Pasture-Recovery.pdf.

Wikipedia

{{cite report |last1=Oliveira |first1=Wagner |last2=Souza |first2=Priscila |last3=Assunção |first3=Juliano |title=The Impact of Brazil's ABC Program Credit on Pasture Recovery: Evidence from the Cerrado |publisher=Climate Policy Initiative |date=September 2024 |url=https://www.climatepolicyinitiative.org/wp-content/uploads/2024/08/Report-The-Impact-of-Brazils-ABC-Program-Credit-on-Pasture-Recovery.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{oliveira2024impact, author = {Oliveira, Wagner and Souza, Priscila and Assunção, Juliano}, title = {{The Impact of Brazil's ABC Program Credit on Pasture Recovery: Evidence from the Cerrado}}, institution = {Climate Policy Initiative}, year = {2024}, month = sep, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2024/08/Report-The-Impact-of-Brazils-ABC-Program-Credit-on-Pasture-Recovery.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }