CNA debates Agro Law and Harvest Plan

The Brazilian Agriculture and Livestock Confederation (CNA) participated, on Thursday (2), in a virtual debate promoted by the Parliamentary Agricultural Front (FPA) on the impact of the Agro Law (13.986/2020) on financing for agriculture, Agricultural and Livestock Plan 2020/2021 and structuring measures for agriculture.

The technical advisor of the CNA National Agricultural Policy Commission, Fernanda Schwantes, represented the entity at the meeting. Representatives from the Ministry of Agriculture, Central Bank, National Treasury Secretariat and Instituto Pensar Agro (IPA) also participated. Federal deputy Pedro Lupion (DEM/PR), rapporteur of the Agro Law, was the moderator.

Schwantes highlighted the expansion of the volume of resources from the Safra Plan, especially in programs for irrigation (Moderinfra), low-carbon agriculture (ABC), construction of warehouses (PCA), small producers (Pronaf) and medium producers (Pronamp).

But, in her assessment, one of the main gains was the 30% increase in the volume of resources for the Rural Insurance Premium Subsidy Program (PSR), which will have R$1,3 billion in the 2021 budget. highlighted, however, that it is necessary for the resources to be implemented.

“The alignment of Minister Tereza Cristina (Agriculture) with Minister Paulo Guedes (Economy) gives us this comfort that the resources will be executed and the producer will count on the subsidy, despite the need for this amount to be approved in Congress”, he said Fernanda Schwantes.

This volume of PSR resources provides coverage of 21 million hectares of area and an insured amount of R$58 billion. “This represents more than 30% of the grain area we have today and around 8% of the Gross Production Value”.

She considered, however, that not all activities have an insurance product that meets the needs of rural producers. As an example, she cited livestock farming and aquaculture. In this context, the CNA representative recalled that Mapa has adopted measures to improve insurance, disseminate information and train brokers and experts.

“We are partners with Mapa in the Rural Insurance Monitor Project, to improve what is linked to the insurance product”, he explained. She added that the CNA has also been discussing improving the insurance market with insurers to serve more producers.

Regarding the Agro Law, Fernanda highlighted some CNA proposals that were incorporated into the MP, such as the subsidy for premiums on sales option contracts, which was accepted in the text. According to her, a budget forecast is now needed for this measure to be implemented.

"This is an old demand from the CNA, which was incorporated through an amendment to MP 897. A budget forecast is now needed for this program. The CNA has been working for some time with proposals for operational models that can be adopted to carry out this program, which are being discussed with the Agricultural Policy Secretariat of the Ministry of Economy", he pondered.

She also said that the CNA will continue working to facilitate structuring measures for agriculture. One of the proposals defended by the CNA is to establish governance mechanisms and practices for the distribution of interest rate equalization resources among financial institutions.

In this context, he assessed, criteria such as the capillarity of financial institutions must be considered, both physically and in relation to the provision of contracting conditions and remote verification of the application of rural credit, the proportionality of resources applied in relation to the resources scheduled for application, and the variation in the concentration of resources applied in number of beneficiaries and productive activities.

Other CNA proposals include increasing transparency regarding the requirements of financial institutions when granting rural credit and improving and monitoring tying, with the aim of penalizing financial institutions in cases of abusive practices. Another point to be worked on is the reduction of compliance costs, which also end up indirectly burdening the producer.

“We are discussing the issue with financial institutions and the Government, which signed a cooperation agreement to combat tying. We also created a platform for producers to report so that institutions can be punished.”

The debureaucratization of the National Rural Credit System (SCNR), the improvement of customer risk analysis instruments, considering the profile of each producer and not just the guarantees available when taking credit, the transfer of resources from constitutional funds to private banks and credit cooperatives and a multi-year plan for agriculture were other topics prioritized by the CNA in the debate.

"Our objective is to build, together with the Government and Congress, measures that reduce bureaucracy and actually serve rural producers, who are the beneficiaries of agricultural policies."