Judicial Reorganization in Agriculture: From Exception to Restructuring Tool

Agribusiness has been resorting to insolvency proceedings at an unprecedented rate. Requests for judicial reorganization related to the sector jumped from 1,272 in 2024 to 1,990 in 2025, a 56.4% increase and the highest volume in the historical series, while rural delinquency reached 8.8% in the first quarter of 2026, also the highest rate ever recorded by Serasa Experian. These figures illustrate the severity of the crisis in the agricultural sector. However, they also reveal a second, less discussed but equally significant trend: the incorporation of judicial reorganization into the ordinary crisis management repertoire of rural producers, after a long period in which the mechanism was, in practice, inaccessible to them.

This incorporation has an identifiable trajectory and constructive meaning. Law No. 11,101/2005 was conceived for entrepreneurs and business corporations, based on a predominantly urban, industrial, and commercial logic. Law No. 14,112/2020 expressly regulated the access of rural producers to the regime, so that the system did not remain indifferent to the countryside, but reached it in stages, and continues to be adjusted.

The aforementioned adjustment is imposed by the inherent logic of agricultural activity, marked by seasonality, crop cycles, dependence on climatic factors, the volatility of commodity prices, and the presence of biological assets that do not allow for abrupt interruption. These particularities do not always immediately align with the scenarios contemplated by Law No. 11.101/2005, which requires an interpretation tailored to the specificities of rural activity.

Recognizing this distinction precisely defines the role that judicial reorganization plays in the sector. For example, if a significant portion of the liabilities are outside the judicial reorganization process, the process ceases to operate as an isolated response and begins to function as the axis of a broader restructuring architecture, which combines the collective negotiation of the subject credits with bilateral negotiations of the others, supported by instruments that the law itself offers. The suspension of executions opens the indispensable time window for negotiation, and the prohibition on the sale or removal of essential capital assets during this period safeguards precisely what the recovery depends on, which is the productive capacity in operation.

This leads to the most relevant practical consequence for the producer. Since the scope of the bankruptcy proceedings is defined by the origin and accounting of the credits, a significant portion of the outcome of the judicial reorganization is decided before the filing of the lawsuit. Judicial reorganization is a technical tool whose effectiveness depends on a prior diagnosis, a cash flow projection aligned with the production cycle, and a plan that creditors can recognize as feasible; it is not an automatic solution, nor should it be treated as an improvised last resort.

Preserving viable rural activity is in the interest of the producer, creditors, and the entire chain that depends on it. Therefore, what defines effective recovery is not the abstract adaptation of the law to the field, but rather the quality of preparation with which the producer enters the process. Thus, it is in the actions prior to litigation that the strategy is designed, in the diagnosis that defines if, when, and how judicial reorganization should be used, and in the structuring that transforms the legal framework into a concrete result of restructuring.

By Laura Schmitt