Juhayna Dairy

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Translated version of this PSD: Arabic The EBRD is considering providing a loan of EGP 945 million to Juhayna Food Industries and subsidiary companies. The financing will be used to invest in dairy production capacities, juice production capacities and distribution and logistics assets in addition to balance sheet restructuring (the “Project”). This project will demonstrate the development of modern dairy processing and fruit juice production capacity with environmental standards and levels of resource efficiency which will go significantly beyond currently prevailing levels in the sector. Additionally, the project will help to make the company’s distribution system more effective. Consumers will benefit from the increased local production of milk and juices through better access to high-quality, fresh dairy products and juices. Juhayna Food Industries and subsidiaries in Egypt. Up to EGP 945 million 7-year loan. EGP 1150 million. The project has been Categorised B in accordance with the EBRD’s ESP 2008 and risks and impacts are likely to be site specific, readily identifiable and mitigation measures achievable. Detailed environmental and social due diligence has commenced and will include an E&S audit and analysis of the project by independent consultants, a visit to the site, interviews with key management personnel and document review. The project is expected to results in significant and replicable environmental and social benefits, including reduction in CO2 and other pollutants through waste utilisation / generation of electric energy and improvements in hygiene standards. The project is also anticipated to provide an opportunity to supply chain farmers to improve their health and safety and waste management at the operational level. An environmental and social action plan will be developed to address any issues identified during ESDD in order to comply with the Bank’s Performance Requirements. This section of the PSD will be updated at the conclusion of ESDD. A Technical Cooperation (TC) project will cover work with Juhayna’s raw milk suppliers of 85 local farmers, 70 of which are under supply contracts with Juhayna. The TC will have the following objectives: a) Support with technical training for individual farms/farmers that supply Juhayna with milk, to help achieve health and safety and other operational certifications; and b) Support involving provision of improvements that can be made across farm management including milking techniques, feed production, and systems integration. The proposed TC would provide strong backward linkages to dairy production in Egypt, which is highly fragmented among a number of individual farmers with low levels of technical training and a lack of farm management skills. Furthermore, as a leader in the dairy market in Egypt, this would set a precedent for competitors to follow suit with the farms that supply their milk. Mr. Sameh Zaki Al-Hodaiby, Juhayna Food Industries E-mail: Sameh.hodaiby@juhayna.com