Default in the countryside affects 7,7% of the rural population

A new survey by Serasa Experian revealed that, considering debts overdue for more than 180 days and which were contracted with companies in sectors related to the main agribusiness activities, only 7,7% of the rural population were in default in the country during the third quarter of 2024. Compared to the second quarter, also last year, the default rate increased by 0,3 percentage points.

For the head of agribusiness at Serasa Experian, Marcelo Pimenta, “given the challenges of accessing credit, rolling over debt, the level of commodity prices, and other setbacks, such as climate events that affected financial stability in the countryside, the scenario, even with a slight increase, is still relatively good, since most Brazilian rural landowners remain compliant”.

The analysis by size identified that, in the third quarter of 2024, small landowners were the least impacted by default, registering a rate of only 6,9%. Next were medium-sized landowners, with 7,4%. Those who do not have a rural registry – tenants, people participating in economic or family groups – came in third place, with 9,9%. While large landowners had the highest percentage, at 10,2%.

“Norte Agro” was the most defaulting region in the analysis period

According to the data, the “Norte Agro” region – which covers the North of Brazil with the exception of Rondônia and Tocantins, in addition to including the Northwest of Maranhão – recorded the highest default rate in the third quarter of 2024, marking 11,1%. On the other hand, the South region had the lowest percentage, of 5,0%. Check out the complete data on the “agro regions” of Brazil in the following graph:

More experienced rural landowners tend to be less likely to default

Still in the third quarter of 2024, according to data from Serasa Experian, the portion of the rural population least affected by default are those of older age. Meanwhile, owners aged 18 to 29, for example, represent the largest portion of defaulters. See the full information in the graph below:

Sectors related to agribusiness showed an optimistic scenario

Considering the sectors in which the rural population contracted its negative debts, it is possible to identify that “Financial Institutions” – which finance activities in the field – have the largest representation, at 6,8%. However, the share of rural property owners in default in the “Agricultural Sector” and “Other Related Sectors” is very small, at 0,2% and 0,1%, respectively. These two categories encompass products and services, such as agro-processing industries and agro-wholesale trade, agricultural support services, production and resale of inputs and agricultural machinery, rural producers, non-life insurance companies, transportation and storage.

“It is interesting to note that the agricultural chain had an optimistic outlook regarding default in this regard. We need to reinforce this distinction since, while in general only 7,7% of rural landowners are in default, in this segment, the percentage is even lower,” concludes Marcelo Pimenta, head of agribusiness at Serasa Experian.

Exclusive

For the Serasa Experian Agribusiness Default Indicator, only individuals with debts overdue for more than 180 days and up to 5 years totaling at least R$1.000,00 were considered among those related to financing and agribusiness activities, in the following categories:

- Financial institutions: banks, investment funds, credit unions, among others described as "financial services activities" by the IBGE.

- Agro Sectors: agro-industry for processing and wholesale trade in agriculture, agricultural support services, production and resale of agricultural inputs and machinery, rural producers, etc.

- Other Sectors: non-life insurance, freight transport, storage, utilities, retail, telecommunications etc.