The Inter-American Development Bank approved $100 million in financing for biofuel and sustainable agriculture projects in Brazil.
The funds will be for investments through Banco ABC Brasil SA, said Luiz Antonio Assumpcao Neto, director of foreign funding at ABC. The Brazil bank has one year to choose projects and existing businesses to finance.
“At least 20 companies will receive the support,” Neto said Thursday in a telephone interview from Sao Paulo. “The objective is to give access to different funding for companies focused in sustainability.”
In 2011, President Dilma Rousseff’s government set price caps for gasoline in an effort to control inflation, forcing producers to curb ethanol prices. Since then, 47 ethanol mills were shut, according to a December report from Brazil’s sugar- cane trade group Unica.
ABC Bank has a loan portfolio of about $1 billion for agribusiness companies, which represents about 11 percent of the bank’s total, Neto said. The bank will target corporate lending to sugar, ethanol and biomass producers for pre-export finance, working capital, sugar-cane fields re-planting and expansion, selling the harvest and equipment, it said in a statement in the Inter-American Development Bank’s website.
Neto didn’t provide more information on the financing line. IDB’s spokesman wasn’t available to comment, according to a press officer.
The ethanol industry’s debt has increased to 70 billion reais ($22 billion), according to Unica Chief Executive Officer Elizabeth Farina.
“There are many companies that have been able to adapt and gain efficiency, even in the country’s negative environment,” Neto said.
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