Special Committee Approves Rural Debt Renegotiation Measure in Brazil
Legislators advance bill to restructure agricultural debt amid rising rural default rates.
1Legislative Progress on Debt
The special committee analyzing Provisional Measure 1.376 approved a report by Deputy Paulo Pimenta on November 10, 2026. The proposal aims to expand rural debt renegotiation programs for producers facing climate-related losses. The text now moves to the Chamber and Senate plenaries, requiring urgent approval by November 11 to remain valid.
2Rising Default Rates
The report highlights a significant increase in rural delinquency as the primary justification for this intervention. Official data indicates that the default rate climbed from 3.99% in May 2024 to 7.17% by May 2026. Meanwhile, only 14% of the 100 billion reais originally announced by the government has been successfully renegotiated.
3Scope of Beneficiaries
The latest version of the report expands the eligibility criteria for debt relief. It moves the starting date for eligible operations back to January 1, 2021. This change covers various agricultural activities, including production, commercialization, and working capital, while also adjusting the formalization windows for investment-related debt and subsequent contractual addendums.
4Regional Loss Adjustments
For producers in Sudam, Sudene, and Sudeco regions, the minimum loss requirement for eligibility has been reduced. The threshold drops from 30% to 25% for general regimes and from 40% to 35% for exceptional cases. However, Rio Grande do Sul maintains its original loss requirements of 30% and 40% respectively.
5Operational and Legal Changes
The updated text allows collective reports to verify losses for small and medium producers, including those under Pronaf and Pronamp lines. Operations can be contracted within 120 days of the law's regulation, with an optional 120-day extension. The measure also clarifies that payments made before the law's publication are excluded from renegotiation.
6Inclusion of Corporate Entities
The scope now extends to cereal traders and other legal entities involved in the storage or commercialization of agricultural products. These entities, alongside input suppliers and cooperatives, can now include their Rural Product Notes (CPRs) in the renegotiation process, provided the issuance occurred before the December 31, 2025, cutoff date.
7Financial Terms Maintained
Despite pressure from the Parliamentary Front for Agriculture to lower interest rates and extend payment terms, the rapporteur rejected these amendments. General operations retain interest rates between 6% and 12% annually with eight-year terms. Producers facing severe losses over three or more harvests may still access specialized terms up to ten years.
8Strategic Legislative Outlook
The committee's decision reflects a delicate balance between providing relief to the agricultural sector and maintaining fiscal discipline. By rejecting broader changes, the government aims to ensure the program remains operational. The upcoming plenary votes will determine if this framework can effectively stabilize rural credit markets before the legislative deadline expires.
Original article: Poder360 — Special Committee Approves Rural Debt Renegotiation Measure in Brazil