MercoPress. South Atlantic News Agency

Brazil targets 5% increase for next crop and loans 67bn USD to farmers at zero rate

President Rousseff wants Brazil to become a world food production power

Brazilian president Dilma Rousseff announced an agriculture support plan of approximately 67 billion US dollars with the purpose of increasing by 5% the 2011/2012 harvest of grains and oil-seeds

The Agriculture and Livestock 2011/2012 Plan announced in an official ceremony by President Rousseff has the target of increasing the current record crop of 161.5 million tons to 169.5 million tons next season beginning July.

“The purpose of the Plan is to consolidate Brazil as one of the major food producers in the world, guarantee domestic supply and increase exports which already represent 40% of all of the country’s overseas sales”, said the Ministry of Agriculture.

The support plan for farmers is also geared to an abundant supply of grains, oilseeds and beans for the home market to stabilize home prices and avoid any inflation bout, because of shortages.

The resources for funding the Plan are 7% higher that for the last crop (62.5 billion USD) and will be implemented mainly through cheap access to credit.

“We must provide our farmers with the same weapons” as international farmers, said Rousseff during the launching of the Plan.

“We must guarantee farmers the adequate financing. An 80% of the resources will be loaned with an interest rate of 6.57%”, added the head of state, which is half the basic interest rate in Brazil (12.25%).

Current inflation in Brazil is running at an annualized 6.55%.

Ms Rousseff also emphasized that loans with almost zero interest are compatible with the international market and will allow Brazilian farmers to compete in equal conditions with other countries.

The President underlined that Brazil is one of the few countries left in the world with the capacity to increase farm production without having to de-forest and that condition has been repeatedly confirmed as the country becomes a leading world supplier of food.

“A country which aspires to become a food producing power, must also be an environmental aware power”, concluded the head of state.