Agro registers an increase in Private Finance hiring in May

In the current 2022/23 harvest, from July to April, the accumulated registrations of the Rural Product Certificate (CPR) already add up to R$ 218.91 billion, a value that represents an increase of 66% in relation to the same period of the previous harvest. The data are in the May edition of the Agro Private Finance Bulletin, which is published by the Agricultural Policy Secretariat of the Ministry of Agriculture and Livestock.

Economist Roberto Dardis explains that this growth in titles is due to the heating up of the sector, and the good expectations of this year’s harvest. “The more the crop grows, the more financial institutions will be able to issue more of these bonds. The way in which the crop grows will be linked to new bond issues,” he explained. The growth in the stock of funds from these financing instruments is also shown in the bulletin. The performance of the Agribusiness Letter of Credit (LCA) continues strong, being currently considered the main source of free Rural Credit resources, with around R$ 400 billion in stock.

According to the current rule, taking into account the current stocks of LCA, banking institutions need to reinvest in Rural Credit the equivalent of R$ 40.96 billion with LCA resources. However, due to the high demand for financial resources, in the 2022/23 harvest alone, financing that has LCA as a source already represents almost twice as much, with R$ 73.53 billion, mainly for large producers.