ECOM Forastero

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ECOM Agroindustrial Corp. Ltd. (“ECOM” or the “Company”) is a global agro-commodity trader based in Switzerland. ECOM procures commodities, provides primary processing, logistics and risk management services, and sells to branded product manufacturers. The proposed investment of up to US$230 million to ECOM comprises: (1) a US$200 million term 1-year loan, renewable annually at IFC’s option up to three times and (2) a US$30 million 2-year subordinated loan, renewable for two 1-year periods at the request of the Borrower, in each case with the consent of IFC and aimed at funding working capital for ECOM’s cocoa sourcing operations in Cote d’Ivoire (CDI) and Ghana. The proposed investment would enable ECOM to i) strengthen its balance sheet; ii) sustain offtake volumes and finance cocoa farmers; and iii) invest into its sustainable cocoa supply chain. In the 2023-24 buying season, ECOM sourced a total of 149,733 Mt of cocoa beans from CDI and Ghana, all of which were at least traceable to the cooperative or farmer level. Of these, 68% were sourced from farmer communities with intervention and support programs directly managed by ECOM field staff and the remainder, sourced from farmer communities with interventions and support programs managed by partner suppliers, with indirect support and oversight from ECOM. More than half of ECOM’s traceable supply chain volumes were certified with voluntary sustainability standards (VSS). IFC financing will only support the procurement and export of cocoa beans that are sustainable (i.e. 100 % traceable at least to the cooperative or farmer level, and from farmer communities that benefit from active intervention and support programs). ECOM neither owns any farms nor is expected to own any farm as part of this financing. Most cocoa bean harvesting is undertaken from October to March (80% of the annual harvest), while the rest of it is obtained in April to September. In CDI, ECOM either directly sources cocoa beans through its local subsidiary Zamacom or via partner suppliers, who work with ECOM to implement sustainable sourcing programs with cooperatives. Zamacom leases a single warehouse in San Pedro Port where the directly sourced cocoa beans are received, dried, and packaged for export to ECOM. The partner suppliers use their own warehouses at San Pedro or Abidjan ports, which are not for the exclusive use of ECOM.  ECOM does not manage the transport of cocoa beans in the supply chain. In Ghana, cocoa sourcing is regulated by the Ghana Cocoa Board (COCOBOD). ECOM owned Licensed Buying Companies (LBCs) - Agroecom Ltd. and Unicom Commodities Ltd., purchase cocoa beans from farmers through purchasing clerks at the district level. The LBCs then transport the cocoa beans to one of three takeover points run by the Cocoa Marketing Company (CMC) at Tema, Takoradi, or Accra ports, from which the beans are then exported to ECOM. ECOM has a logistics subsidiary called Kiteko Ghana which owns and operates a fleet of trucks to transport and store cocoa beans in warehouses. ECOM does not undertake any processing in-country. ECOM has been an IFC client since 2006 and has an existing project invested in 2016. The E&S performance of the existing project has been satisfactory with all the agreed ESAP items completed - https://disclosures.ifc.org/project-detail/ESRS/36815/ecom-corp-loan.