Jan 10, 2013

• In the new edition, the BNDES’ Prorenova will also have a R$ 4 billion allocation


The  BNDES’ Support Program to Renew and Develop New Sugarcane Fields (BNDES Prorenova) was extended to December  31 and will have a R$ 4 billion allocation.



Launched in early 2012, the BNDES Prorenova is aimed at encouraging the production of sugarcane by financing the renewal of old sugarcane fields and expanding the cultivated area. This is essential to increase productivity in Brazil’s sugarcane plantation and consequently expand the production of sugar and ethanol.



In the first year of operation, the program also had a R$ 4 billion allocation, carrying out more than 70 operations, totaling R$ 1.4 billion until December 31, 2012. The funds enable approximately 410,000 hectares to be planted, some 80% of which is aimed at renewing sugarcane fields. Brazil renovates approximately 1.6 million hectares of sugarcane plantation per year.



Two changes were made to the new edition of Prorenova. The first refers to the financing limit per hectare for sugarcane planted within the scope of the investment project, which rose from R$ 4,350 to R$ 5,450.



The limit will only take into consideration the financing from the BNDES; therefore, it will not be applied to the portion of the project carried out with their own resources or other financing sources.

 

Only the projects of sugarcane plantation carried out between January 1 and December 31, 2013, will be financed within the scope of Prorenova. However, all disbursements made as of July 1, 2012, for the plantation, may be reimbursed.



Unlike the first edition of Prorenova, backdating will be employed both for automatic and non-automatic indirect operations.



The BNDES Prorenova’s operations will remain indirect, that is, carried out by financial institutions accredited by the BNDES. For medium-large and large companies (which have gross operating income equal to or higher than R$ 90 million) the cost of financing is still the Long-term Interest Rate (TJLP) plus 1.3% per year of the BNDES’ Basic Spread. For micro, small and medium-sized companies (MSMEs), the financial cost still comprises TJLP plus 0.9% per year for the BNDES’ Basic Spread.



The BNDES maximum participation will be up to 90% of the eligible items for MSMEs, and up to 80% for medium-large and large companies.



The term of the loan will be up to 72 months, including the grace period of up to 18 months, for medium-large and large companies. For MSMEs, the loan terms will be established after assessing the payment capacity of the project, the beneficiary and the business group.