Sustainable Coffee Farming Makes Rural Insurance Cheaper

Akim Kovalev

Historic Agreement Utilizes Carbon Credits to Make Policies More Affordable for Coffee Farmers

In a landmark agreement signed on Tuesday, July 16, the Ministry of Agriculture and Livestock (Mapa), the National Coffee Council (CNC), and multinational Pró Natura International have initiated the “Sustainable Brazilian Coffee Farming – Carbon Credit Compensation System in Rural Insurance Policy in Brazil” project. This innovative initiative leverages carbon credits to financially benefit coffee farmers who adopt sustainable practices, offering them additional protection against agricultural risks.

Key Aspects of the Agreement

The agreement focuses on integrating sustainability with rural insurance policies, addressing agricultural risks, and adapting to climate change. Guilherme Campos, Secretary of Agricultural Policy at Mapa, emphasized the novelty and multifaceted nature of the project, highlighting its alignment with sustainability and climate change mitigation.

The project aims to make rural insurance more affordable by utilizing carbon credits. The financial performance of producers concerning their carbon footprint will be continuously evaluated, providing ongoing incentives for sustainable practices. The agreement also seeks to reduce pre-harvest financing costs for producers by developing the viability of assets obtained through carbon credits.

Financial and Environmental Benefits

According to Jônatas Pulquério, Director of the Risk Management Department, the primary goal is to lower rural insurance policy costs through financial compensation from selling carbon credits. This approach promotes a favorable insurance policy for rural producers, in line with good agricultural practices and climate change mitigation efforts.

Next Steps

With the signing of the agreement, studies will commence to determine the discount percentages on insurance policies and the model of this benefit. Additionally, a cooperative will be selected to implement the project, ensuring that the initiative is well-coordinated and effective.

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Sustainable Coffee Farming Makes Rural Insurance Cheaper

Akim Kovalev

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