Brazil's MP 1.376 creates special credit lines for climate‑hit farmers

The provisional measure MP 1.376/2026 authorises special rural credit lines to help producers and cooperatives renegotiate debts caused by severe climate events between 2019 and 2025. Eligible borrowers must prove losses of at least 30 % in two or more harvests, or 40 % in three, with financing up to R$ 8 million, interest rates from 5 % to 12 % per year and repayment periods of up to ten years, including a two‑year grace period.

The measure also creates a guarantee fund and allows the use of the new lines to settle or amortise existing obligations for production, marketing, industrialisation and investment. The government estimates that about R$ 100 billion of debt could be renegotiated, with an annual fiscal impact of less than R$ 4 billion. Law‑makers, including Deputy Alceu Moreira (MDB‑RS), say the MP is the best possible agreement after negotiations, improving repayment terms to eight years plus two years of grace and reducing interest rates from the original 6‑12 % to 5‑11 %.

Implementation requires regulation by the Conselho Monetário Nacional (CMN) and approval by banks, which will assess each request against internal risk policies.