Brazil’s farmers are facing a serious debt problem in 2025, even though the country produced a record soybean crop this year. Official data shows that nearly 8% of individual farmers have not paid back their loans for more than six months.

This problem is not limited to a few people. Many farmers, especially those who own large farms or rent land, are struggling to keep up with payments. The main reason for this growing debt is that the cost of borrowing money in Brazil has gone up.

Interest rates are now at their highest level in twenty years. Farmers who borrowed to buy seeds, fertilizer, and equipment now find it much harder to pay back what they owe.

At the same time, prices for crops like soybeans have dropped, so farmers are making less money even when they harvest more. The debt crisis is hitting some regions harder than others.

In the North, especially in the state of Amapá, more than one in ten farmers are behind on their payments. In the South, where more farmers use insurance and have access to special credit programs, the default rate is much lower.

Brazil’s Farmers Face Rising Debt Despite Record Harvests. (Photo Internet reproduction)

For example, in Rio Grande do Sul, less than 5% of farmers are in default, even after facing floods and droughts in recent years. The number of farm bankruptcies is rising fast.

Brazil’s Farm Debt Crisis

In 2024, nearly 300 agricultural companies entered court-supervised reorganization, which is a legal way to try to avoid bankruptcy. This is almost 40% more than the year before.

Most of these businesses are small or family-run, and many do not have the financial tools or insurance to survive bad years. The Brazilian government is trying to help. A new program will allow almost one million small farmers to restructure or write off their debts.

Most of these farmers owe less than R$10,000 (about $2,000), but together, their debts add up to more than R$19 billion. The plan will give discounts of up to 96% on some debts and help farmers regain access to credit by removing their names from blacklists.

The program is waiting for final approval and should start soon. This debt crisis matters for everyone, not just for Brazil. Brazil is one of the world’s biggest food producers.

If more farmers go bankrupt or cannot plant their crops, food prices could rise everywhere. The crisis also shows how farming depends on more than just good weather or big harvests.

Farmers need fair prices, affordable loans, and support when things go wrong. Without these, even a record harvest cannot guarantee financial security.