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Brazil Senate-Approved Profert Bill Could Affect Brazil Potash Funding, Pending Lula Signature

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Announcement Summary

Brazil Potash Corp. (NYSE American: GRO) highlighted the potential effects of Brazil’s Profert bill on construction funding for the Autazes Project.

  • The Senate approved the bill on August 11, 2026; it awaits President Luiz Inácio Lula da Silva’s signature, which the company expects in coming weeks.
  • The bill authorizes BNDES to invest in construction of new domestic fertilizer production capacity and provides a credit line for sector infrastructure.
  • Profert would provide a production tax credit of up to 20% of domestic fertilizer investment, capped at R$2 billion per year from 2027 through 2031.
  • A technical analysis says Profert combined with SUFRAMA could exempt up to ~US$190 million in federal taxes on US$2.5 billion of initial capex, reducing required capital by approximately 7%.
  • The mandatory domestic-content floor starts at 2% in 2027 and rises to 10% by 2037, with potential to reach 30% subject to supply availability.
  • Eligibility for equipment and construction-material exemptions depends on a competitive selection process under unpublished MAPA regulations; specialized legal and tax counsel is also required, and realization is uncertain.

The Autazes Project is in Amazonas and has a projected capacity of 2.4 million tons per year. About 91% is committed under long-term take-or-pay sales agreements with AMAGGI, Keytrade and Kimia.

Investor FAQs

Profert (Bill’s PL 699/2023) was approved by the Chamber of Deputies on May 27, 2026, and by the Senate on August 11, 2026. It now awaits signature into law by President Luiz Inácio Lula da Silva, with the source saying this is expected in the coming weeks. The legislation has therefore not yet been enacted.
The bill combines a tax credit for domestic fertilizer production, a Brazilian development bank (BNDES) credit line to finance sector infrastructure, and a mandatory domestic-content floor for fertilizer sold in Brazil. The floor starts at 2% in 2027 and rises to 10% by 2037, with the potential to increase to 30%, subject to supply availability. The bill also creates a production tax credit of up to 20% of investment in domestic fertilizer production, capped at R$2 billion per year between 2027 and 2031.
Brazil Potash states that a technical analysis of the Autazes Project’s financial model shows Profert, combined with SUFRAMA (Superintendence of the Manaus Free Trade Zone), could exempt up to ~US$190 million in federal taxes on the Autazes Project’s US$2.5 billion in initial capex. The company says this could reduce the amount of capital it needs to raise before construction begins by approximately 7%. These are potential benefits, and the source says there is no certainty that they will be realised by the Company.
No. Brazil Potash’s eligibility for Profert tax exemptions on equipment and construction materials contemplated in the bill will depend on a competitive selection process under regulations from the Ministry of Agriculture and Livestock (MAPA), which have not been published. The Company will also require specialised legal and tax counsel regarding the potential combination of the SUFRAMA and Profert regimes. The source says there is no certainty that these benefits will be realised by the Company.
Profert authorises BNDES, Brazil’s National Bank for Economic Development, to invest in the construction of new domestic fertilizer production capacity. The source does not state whether Brazil Potash will receive BNDES funding or the amount or terms of any such funding.
The source states that Brazil imported approximately 85% of the fertilizer it consumed and spent roughly US$15 billion on fertilizer imports in 2025. It also states that approximately 96% of potash was imported from a small number of supplier countries, while a separate company description says Brazil imported approximately 97% of its potash fertilizer in 2025. The source says Brazil’s current domestic potash production capacity is not enough to meet the proposed domestic-content requirements.
Brazil Potash Corp. (NYSE American: GRO), also identified in the source as Brazil Potash (NYSE-American: GRO), is developing the Autazes Project in Amazonas. The Company describes the project as having a projected capacity of 2.4 million tons per year, with about 91% of that projected capacity committed under long-term take-or-pay sales agreements with AMAGGI, Keytrade and Kimia. The source identifies uncertainties relating to Profert’s enactment and implementation, eligibility for government programmes and competitive selection processes, combining SUFRAMA and Profert, obtaining required licences and permits, securing project financing and raising additional funds for project construction. It also states that forward-looking statements involve risks and uncertainties and that actual results may differ materially from them.

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