In January 2020, LDC signed a new US$100 million facility with the European Bank for Reconstruction and Development (EBRD) to support the sustainable expansion of our commercial activities in eight countries across Europe, the Middle East and Africa (EMEA).
Producers, supply chain partners and customers in Bulgaria, Egypt, Kazakhstan, Poland, Romania, Tajikistan, Turkey and Ukraine will benefit from this agreement, which will connect many small and medium-sized grains and cotton farmers to LDC’s operating network, facilitating their planning and development.
The agreement also provides for farmers to receive training in good agricultural practices to improve agricultural yields and quality, and thus increase their income, while addressing climate change risks and impacts.
Through this facility, the EBRD aims to support cross-border trade flows and agricultural commodities market expansion, by enhancing and strengthening connections between the production powerhouses of eastern Europe and the growing consumer markets of northern Africa.
In particular, improving flows between Ukraine, one of the world’s leading grain exporters, and Egypt, one of the world’s top grain importers, could benefit both countries while improving global food security.
LDC is also leveraging the funding to expand cotton operations in the region. We are already a top cotton exporter in Kazakhstan, but this partnership supports our expansion into Tajikistan, a country whose cotton industry supports around half of its rural population.
The agreement also provides for the adoption by LDC of an enhanced climate corporate governance approach, including the development of new tools for climate-related risk management and climate scenario stress testing of grain harvests in Ukraine and cotton harvests in Turkey.
These tests will generate experience and data that reinforces our understanding of climate change impacts on various supply chains, and therefore our ability to support farmers and suppliers in mitigating these.
“Our close relationship with EBRD stretches back to 2000, when we began working together in Russia,” said Hervé Sahores, LDC’s Chief Financial Officer for EMEA Region. “Our most recent agreement will support geographic expansion, drive supply chain efficiency and enable even better service to our growing customer network. It is another example of the strategic partnerships that are central to LDC’s growth model and a cornerstone of our transformational strategy today.”