PRETATERRA Answers: What Is a Green CPR?

“I have a good area of ​​preserved secondary Atlantic Forest, I would like to know where I can get information about the decree that created the Green Rural Product Note for payments for environmental services and how to obtain it in “practice”. Thank you.”

This is a question we frequently receive. After all, what is Green CPR?

Brazilian farmers and agribusinesses have long used the Rural Product Note (CPR). It was created by law 8,929/1994 with the intention of enabling self-financing for farmers to invest in their crops.

The main difference between the Green CPR and the traditional CPR is that, instead of being obliged to deliver an agricultural or livestock product (e.g. soybeans, corn, beans, etc.), the rural producer will commit to preserving the environment on his property in exchange for financial resources.

In other words, it is a financial instrument to finance reforestation activities and maintenance of native vegetation on rural properties. Through it, rural producers receive an incentive to preserve the environment in exchange for financial resources.

The idea is to connect companies and individuals interested in conservation with rural producers, who are willing to preserve forests and apply environmental protection measures.

In the CPR mechanism, the farmer receives money from the issuance of the CPR for a specific rural product, which is often still in the sowing phase, with a promise to deliver the product after harvest to his investor.  In this system, there are clear protections for both sides and the product is tangible. 

CPR Verde is regulated by Decree No. 10,828, in October 2021, which authorized the issuance of CPR for rural products obtained from activities related to the conservation and recovery of native forests that result in the provision of ecosystem services (such as conservation of soil or water resources, forest carbon stock, etc.). 

Because ecosystem services are intangible, the decree provides for its issuance to be certified by a third party to indicate and specify the backed products. The biggest question comes from how to generate this title and offer it to the market. 

As the Decree does not specify who these certifying institutions would be, it is a little confusing what the first step is to take. In any case, it is important to obtain as much information as possible about the area and the ecosystem service provided, that is, to understand what this service is and how to measure it. 

Currently, the environmental services market is better consolidated for carbon, that is, for certified carbon credits. For the CPR-V to be supported, it is likely that the credit must be certified. Other services may require similar verification. 

As this market develops, many of these questions will be answered over time and regulations will be developed to better guide rural producers who want to invest in this. 

There is certainly a lot of potential in CPR Verde!