Agrotrade will use the funding to improve energy efficiency and the processing and preservation of grain crops in addition to replenishing working capital.
KYIV, July 17, 2012 (UBO) -- The European Bank for Reconstruction and Development (EBRD) said today it would provide financing totaling USD 23 million to the Agrotrade group of Ukrainian companies.
EBRD Deputy Director for Ukraine Graham Hutchison and Agrotrade Director General Vsevolod Kozhemyako (pictured) told a press conference today that a relevant agreement had been signed.
“The EBRD will support the Ukrainian agricultural company with financing that will help raise its competitiveness. Today, about 25% of EBRD financing is going to the agricultural sector in Ukraine,” Hutchison said.
The financing package includes a credit for replenishment of circulating capital in the amount of USD 15 million and a long-term credit at USD 8 million to finance measures on energy efficiency and expansion of capacities for processing and preservation of grain crops.
According to Kozhemyako, the funds will go to modernization of capacities for grain drying and construction of a seed production plant in Kharkiv region.
Planned expenditures of USD 10 million this and next year will enable the firm to set high standards for grain production.
Agrotrade cultivates 50,000 ha of farm land in Poltava, Kharkiv, Chernihiv and Sumy regions and plans to export send 800,000 tons of grain this marketing year compared to 150,000 tons in the previous year.
Kozhemyako noted that losses of early grain crops are estimated at 20%, and no further substantial losses are expected but without additional rain losses are possible. However, with drought conditions becoming more serious in the United States, higher prices could compensate for any production losses.
The EBRD loan portfolio in Ukraine now exceeds EUR 7.4 billion (USD 9.76 billion) in 293 projects.