Project detail - AGROFERTIL S.A

AGROFERTIL S.A

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Who is our client

Agrofértil, founded in 1993, is the leading distributor of fertilizers, crop protection products and seeds. The Company also provides agronomic services and is headquartered in Ciudad del Este. Through their extensive network of distribution centers and large number of storage silos located in agricultural zones or rural centers near the major crop regions in Paraguay, the company assists almost 2,500 clients.

Funding objective

FMO aims to provide two facilities: 1) an up to USD 10.5 million long-term facility to finance Agrofértil’s investments in silos and 2) an up to USD 7.5 million medium term working capital loan to fund the Company’s structural working capital needs and increase their capacity to provide pre-harvest financing to farmers in Paraguay.

Why we fund this project

Agrofértil plays a key role in the agricultural value chain in Paraguay, supporting small and medium sized farmers and cooperatives. Agribusiness is considered to be the engine of the Paraguayan economy. Paraguay is the fifth largest producer and fourth largest exporter of soybeans worldwide which contributes to some 23 percent of the country’s GDP. Through this project, FMO will be enhancing Agrofértil's capacity to provide pre-harvest financing to farmers and will contribute to the further development of agriculture sector, a key pillar of Paraguay's economy. Thanks to the pre-harvest financing and agronomic advice provided by Agrofértil, farmers can increase their resource efficiency and are able to increase their productivity and profitability.

Environmental and social rationale

B+ because of supply chain risks. The following Performance Standards are applicable: • PS 1 – Assessment and Management of Environmental and Social Risks and Impacts • PS 2 - Labor and working conditions • PS 3 - Resource Efficiency and Pollution Prevention • PS 4 – Community Health, Safety and Security • PS 6 – Biodiversity Conservation and Sustainable Management of Living. Natural Resources Performance Standard 5 (Land Acquisition and Involuntary Resettlement), Performance Standard 7 (Indigenous People) and Performance Standard 8 (Cultural Heritage) do not apply because the client will not acquire land for expansion, there are no indigenous people or cultural heritage sites present in the area of influence of the client.

More investments

Date Total FMO financing
10/22/2020 EUR 0.07 MLN
6/26/2020 USD 7.50 MLN
12/5/2019 EUR 0.06 MLN
10/28/2016 USD 10.00 MLN
Region
Latin America & The Caribbean
Country
Paraguay
Sector
Agribusiness, Food & Water
Signing date
6/26/2020
Total FMO financing
USD 10.50 MLN
Fund
FMO
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk Environmental & Social Category
(A, B+, B or C)
B+