Agricultural machinery sales have taken off over the last few months, even with increasingly difficult BNDES credit lines

Despite the economic and political crisis in Brazil, the agricultural machinery market could not be making companies and professionals in the sector happier. The shortage of credit lines BNDES, which has been taking place since November of last year, did not prevent the market from continuing to rise and with excellent prospects for 2021. However, despite the good numbers initially, there is concern about investments for possible job losses in 2021/22 .

• Leader in the production of wind energy blades Aeris Energy breaks record in just 45 days
• The week ends with a selection process for the automotive maintenance area opened by a sugar and ethanol plant
• New sources of financing for civil construction
• Banco Nacional do Desenvolvimento focuses on industry 4.0, offering a new line of credit
• After the lack of steel in steel mills impacts on the oil industry, car factories may stop due to lack of material

Luis Felli, president of AGCO South America, said in a report to Estadão that he believes that by the month of March, the agricultural machinery market had sold 20% more tractors and 70% more harvesters. In the Agricultural Machinery Camera of Abimaq, the increase in associated sales was 55%. The 20/21 harvest was a record, which generated great optimism for the next harvest. In addition, the good value obtained by the producers in sales warmed up the market, highlighted Cristiano Correia, Marketing director at John Deere.

Jobs could be at risk if government fails to increase subsidy

In a text published on Canal Rural, Pedro Estevão, president of the Brazilian Association of Machinery and Equipment Industries (Abimaq), lamented the fact that the Government is cutting resources in agricultural credit. According to him, if this continues, credit will become much more expensive, causing farmers to stop investing, causing layoffs and jeopardizing the jobs of workers in such an important sector for the economy.

The sector is waiting for the 2021/22 Crop Plan, and believes that the line will have more than the R$ 8 billion of 2020/21. According to Pedro Estevão Bastos, the market needs R$ 20 billion. The agriculture sector has been investing a lot of money in this pandemic, generating many empregos and helping the Brazilian GDP not to be in an even more worrying situation. With less funding resources, the farmer has to use his own capital to invest, failing to apply that money on other fronts.

Abimaq argues that it is necessary to change the Annual Budget Law (LOA 2021), not to mention important reforms for the sector, with tax and administrative matters. These attitudes would give the Government more flexibility to release credit to the sector.

BNDES announces new rural credit modality

On April 8, Tereza Cristina, Minister of Agriculture, Livestock and Supply, and Gustavo Montezano, president of the BNDES, announced a new way of supporting small farmers, through the credit of guaranteed Agribusiness receivables. The idea is to encourage private credit for small farmers.