EBRD to Assist Development of Grain Transport in Ukraine
The bank will provide financing for new grain hopper railcars
Photo European Bank for Reconstruction and Development
The European Bank for Reconstruction and Development, EBRD, is providing a loan of up to $35 million to Louis Dreyfus Company (LDC) for a railcar logistics business in Ukraine, which will be fully owned by LDC, the EBRD has said in a press release.
The funds will be used to acquire up to 1,000 grain hopper railcars, which will significantly facilitate grain-handling logistics for the company.
According to the press release, LDC will be able to diversify its means of transporting grains from the country’s agricultural areas to its ports.
The new railcars will reduce the volume of grain transported by trucks and will therefore help to lower annual CO2 emissions by 8,510 tonnes.
In 2019, Ukraine is expecting a record grain harvest of more than 72 million tonnes, of which more than 50 million tonnes will be exported. Domestic grain hopper railcars, most of which are heavily depreciated, carry 70% of all grain traffic to the country’s seaports for export. The addition of new grain hoppers will significantly increase the effectiveness of grain-handling logistics and will strengthen Ukraine’s competitiveness in the market competition.
The EBRD is the largest international financial investor in Ukraine. Since the start of its operations there in 1993, the Bank has made a cumulative commitment of almost €13.6 billion through 432 projects in the country.
Louis Dreyfus Company is the largest exporter of Ukrainian grain among foreign companies and has been operating in Ukraine since 1995. The company is engaged in agrarian business as well as grains and oilseeds exports.