Securing gateways for international agribusiness
We are happy to announce our contribution to a long-term loan of up to USD 31 million for Trans-Oil Group. (FMO-A participation: m, BP: .5 mln, DFCD Land-Use Facility: .5 mln, and Proparco: mln.)
Who is Trans-Oil Group?
Trans-Oil Group (TOG) is a leading vertically integrated agribusiness group located across Moldova, Ukraine, Romania, and Serbia, offering services such as grain handling, storage, and trading, farming, and oilseed crushing. The company owns a unique distribution and export network in Moldova with extension to the Black Sea region and upstream to the Danube basin. More than 80% of the sales of the Company are exported via large international traders to EU, Middle East and North Africa (MENA) region and Turkey.
What is our funding objective?
The USD 31 mln long-term FMO loan intends to finance the working capital needs for the purchases of commodities from Ukraine. The commodities sourced from Ukraine will be stored either in Reni port in Ukraine or in-land storage facilities in Moldova before export.
Why do we want to fund this investment?
Moldova has become one of the safest gateways to tranship Ukrainian crops to international markets, in light of conflict and disrupted logistics in the Black Sea region. TOG’s well integrated distribution and export network in Moldova, as well as two grain terminals in the Reni Port of Ukraine, enables increased business volumes from Ukraine. The transaction will contribute to the global food security, financing the origination from Ukraine and thereafter exporting to international markets (especially LICs or LMICs).
What is the Environmental and Social categorization rationale?
FMO’s E&S risk categorization for traders with large processing plants applies a B+ risk category. Business activities include aggregation, distribution, processing, and trading of agro commodities. E&S operational risks and impacts are mostly site-specific with exception of risks of the supply chain. FMO’s Environmental and Social assessments via monitoring and due diligence activities indicate that the investment may have impacts that must be managed consistently with the following IFC Performance Standards: IFC PS1: Assessment and Management of Environmental and Social Risks and Impacts, PS2: Labor and working conditions, PS3: Resource Efficiency and Pollution Prevention, and PS4: Community Health, Safety and Security are applicable to this project. PS6 (Biodiversity Conservation and Sustainable Management of Living Natural Resources) is triggered mainly due to the potential indirect impact of the primary supply chain. PS5 (Land Acquisition and Involuntary Resettlement), PS7 (Indigenous Peoples), and PS8 (Cultural Heritage) are considered not applicable to the company operations.
For more information please visit: Project detail - TOI Commodities SA - FMO