High interest rates affect sustainable rural credit of the 2025/26 Safra Plan

Rural credit with the potential to promote sustainability gains in agriculture totaled R$ 19 billion in the first quarter of the 2025/26 Safra Plan, about R$ 5 billion less than recorded in the same period of the previous crop. The data is from the quarterly bulletin "Rural Credit on a Journey of Sustainability," released by the consultancy Agroicone. For the first time since the launch of the study, the proportion of this type of financing declined, from 22.8% in the first quarter of the 2024/25 crop to 22.6% in the same period of this cycle. The overall drop in credit has been attributed to the high interest rate scenario, the indebtedness of borrowers, and the increase in transaction costs, with more real collateral requirements from the financial sector. Data from Sicor/BCB show that the contraction occurred differently among producers. Considering only operating and investment costs, in Pronaf the drop was 3.2% in the first quarter between the two crops, while in the rest of ...