Sugarcane – Brazil

Key Facts

• Client: Usina Cerradão S.A.
• Term: 6-year term loan (2-year grace period)
• Guarantee instrument: Maturity Subordination
• Guarantee exposure: BRL 32 Mln / USD 5.55 Mln (40% of loan value)
• Effective date: May 2025

Deal Summary

AGRI3 is supporting the mobilisation of BRL 80 Mln from Rabobank Brazil for Usina Cerradão S.A., a sugarcane producer and processor in Minas Gerais, to finance the renovation of approximately 3,700 ha of degraded pastureland for sustainable sugarcane production under Bonsucro certification standards.

The unsecured 6-year loan finances the preparation and planting of leased degraded land, with an initial 2-year grace period for land preparation ahead of crop establishment. The AGRI3 maturity subordination guarantee is essential to allow Rabobank to provide an unsecured facility at a competitive tenor, with capital that would not otherwise be available for this type of land restoration investment.

Impact Rationale

All 3,700 ha of restored land will be managed under Bonsucro certification requirements, one of the most comprehensive sustainability standards for sugarcane globally, covering chemical pesticide reduction, cover cropping, soil health, and water management. Bonsucro-certified producers have been shown to reduce GHG emissions of sugar production by an average of 14% within five years of certification, and Cerradão’s GHG intensity is already below the national average. The ESAP includes commitments on leased land deforestation screening, supplier and contractor environmental compliance, and further development of regenerative practices.

Cerradão has committed to increasing the proportion of women in its workforce, with a target to exceed sector norms. Supply chain commitments include training of partner farmers and contractors on sustainability best practices, widening the impact beyond the company’s directly operated area.

Impact Targets

Protection of natural ecosystem (direct and indirect)

Sustainable agriculture

Improved rural livelihoods