Amaggi Expansion

completed

Amaggi Exportaçao e Importaçao Limitada (Amaggi or the company), an existing IFC client, is one of the leading soybean operators in the Mato Grosso state of Brazil. Brazil is the world’s second largest soybean producer and Mato Grosso accounts for 20% of soybeans produced in Brazil. Soybean production in Mato Grosso is expected to outpace the other regions and increase by 10% p.a. in the next few years. To maintain its market share, Amaggi aims to expand its origination activity, particularly to the east of Mato Grosso, where soybean production is growing, replacing other less profitable agribusiness activities. The project involves the following components: - the establishment of soybean collection centers; - construction of silos with 250,000 tons storage capacity and - refinancing a portion of short-term debt that is currently used to support Amaggi’s permanent working capital needs. The company’s permanent working capital consists of soybean inventory and pre-financing provided to farmers in the form of inputs and cash. The project will enable the company to do the following: - lower its financing cost; - sustain its market share; - establish a presence in growth areas in the east of Mato Grosso. Amaggi has played an instrumental role in promoting sustainable soybean cultivation practices in the Mato Grosso state. Pursuant to the first IFC investment, Amaggi has developed and successfully implemented an Environmental Management System (EMS) that fully complies with World Bank Group environmental and social guidelines. The EMS specifies procedures to ensure that no child labor is employed, no negative impacts to the natural habitats, indigenous communities are present in Amaggi’s own operations as well as the operations of third party farmers who receive pre-financing from Amaggi.