The International Finance Corporation (IFC), a member of the World Bank Group, is providing an up to $165 million (approximately R$ 1 billion) financing to São Martinho, one of Brazil's leading producers of sugar, ethanol and renewable energy.
This investment aims to support the company's decarbonisation efforts in the agribusiness sector, contributing to climate change mitigation and adaptation.
The ten-year IFC loan will support the construction of São Martinho's first biomethane plant at their Santa Cruz Unit, which will produce renewable natural gas through the biodigestion of sugarcane vinasse.
Additionally, the funds will be used to renovate sugarcane fields and treat sugarcane crops at the Santa Cruz Unit, enhancing the renewable biomethane production project.
This initiative will also boost biomethane production by improving sustainable agricultural productivity.
IFC will further support São Martinho`s efforts to reduce greenhouse gas (GHG) emissions and achieve its decarbonisation goals, particularly for agricultural equipment, such as tractors, trucks and irrigation pumps.
Using biomethane as a fuel source for these vehicles and machinery can significantly reduce emissions and contribute to a more sustainable agricultural ecosystem.
Moreover, IFC will collaborate with São Martinho by advising them on their vocational capacity building programme for vulnerable populations, including women in rural settlements and underemployed youth groups, within its area of influence.
"This new transaction strengthens our partnership with IFC and demonstrates the institution's confidence in our sustainable and competitive business model, which invests in innovation to produce clean energy from renewable carbon, promoting economic growth, preserving the environment, and contributing to the social well-being of the communities where we operate," said Felipe Vicchiato, CFO of São Martinho.
"We are pleased to strengthen our partnership with São Martinho through this third project and support their efforts to decarbonize and implement innovative technologies that promote sustainability in the agricultural sector," said Manuel Reyes-Retana, IFC's regional director for South America.
"This new project will not only contribute to the reduction of greenhouse gas emissions but will also help stimulate sustainable and inclusive economic development in the agricultural sector, benefiting local communities and enhancing Brazil's climate resilience," he added.
International Finance Corporation loans $165m for São Martinho biomethane plant
