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Family Farms in Brazil Represent 38% of the National Agricultural Production

Brazil’s National Program to Strengthen Family Farming (Pronaf) is expected to benefit approximately 2 million families in the current (2005-2006) growing year.

The project, also known as the Harvest Plan, will receive a total injection of US$ 3.8 billion (9 billion reais) in federal funds, according to information from the Brazilian Ministry of Agrarian Development (MDA).

According to the MDA’s general coordinator of Rural Production Financing, João Luiz Guadagnin, this year’s plan contains innovations, such as expanded credit facilities for family farmers who live on government land reform settlements.

"The credit for settlement farmers will have more coherence and a good chance of achieving success. Previously, the volume of resources that family farmers received was very small for investment purposes. So we raised the amount from US$ 6.4 thousand (15 thousand reais) to US$ 7.6 thousand (18 thousand reais) per family," he says.

Another noteworthy aspect of the 2005-2006 plan, according to the coordinator, is the new financing system for family farmers who plant oilseed crops suitable for manufacturing biodiesel fuel.

These farmers will be able to borrow money for the part of their production destined for biodiesel use concurrently with loans for traditional crops.

"Previously, farmers borrowed money for biodiesel and were left without credit for other activities. Now, farmers who plant any oilseed crop destined for biodiesel use can borrow money for biodiesel, as well as obtaining loans for traditional crops, such as rice, beans, and corn. One loan no longer competes with the other," he explains.

According to a 2003 study by the Economic Research Institute Foundation (FIPE), family farming is responsible for 10.1% of the Brazilian Gross Domestic Product (GDP), that is, around US$ 66.6 billion (156 billion reais).

The study also shows that family farms were responsible for nearly 38% of the gross value of national agricultural production, despite occupying only 30% of the cultivated area.

Another finding is that, even though the average size of proprietary establishments is nearly 17 times greater than that of family farms, total annual income per hectare in the latter is 2.4 times greater than in the former.

Agência Brasil

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