This survey is part of the Brazilian Ministry of Agriculture (MAPA) and the Climate Bonds Initiative (CBI) Memorandum of Understanding, signed in November 2019, to leverage green finance in the agribusiness sector.While the MoU has a detailed Work Plan with different work streams directed at key stakeholders – investors, producers, regulatory and self-regulatory organizations – it is important to understand investors demand to build a portfolio of green projects.

The green potential of Brazil’s agribusiness is significant. The annual demand for agriculture “working” capital is ~USD 100 billion. In addition, there is the need for investment capital and financial resources for other activities across agribusiness such as input production”, logistics, storage, agroindustry, wholesale and retail markets. The country can also substantially increase production, without further deforestation, which will require more capital to ensure greater efficiency and productivity. Over the last 20 years, the country witnesses environmental and efficiency gains in livestock, where productivity doubled. There is potential to achieve even better results, particularly using degraded pastures for crop expansion.

With the Covid-19 pandemic, food security and supply also becomes increasingly important. This can be achieved through strict sanitary control and increase of animal welfare through better environmental practices, such as Brazils integrated crop-livestock-forestry system. Government is also encouraging funding through capital markets. A new legislation (Law 13.986/2020) was approved in early April to facilitate access for international investors and an Investment Plan (click here https://bit.ly/2ZKqD1N) launched on 23rd of April 2020, to show the potential of this sector to investors worldwide.

The aim of this survey is to understand investor’s appetite for Brazil’s sustainable agribusiness and better meet investors’ needs to accelerate the issuance of green bonds in the sector.