Rabobank%20Foundation

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The Rabobank approach to value chain finance
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Global challenges
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Global challenges
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Three units serving worldwide supply chains

Rabobank International
Rabobank Development
Rabobank Foundation
Development Phase
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Rabobank target countries
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Rabobank main target groups
No financial opportunities and not recognized by
support providers
Considerable support both financial and technical
by NGOs and Government
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Agriculture and Agribusiness
Source Rabo India Finance, A. Datta, 2007
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How to turn a supply chain into a value chain?
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Review of the Value Chain
Source Rabo India Finance, A. Datta, 2007
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Value Chain Finance Framework
Source Terrafina/J. de la Rive Box, 2009
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Towards more inclusive value chains
Source Terrafina/J. de la Rive Box, 2009
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Integrated Agriculture Finance Structure
Equipment purchase contract
Insurer
Supplier
Insurance contract
Buy-back agreement
Transfer of lease payments
Rabobank
Down payment
Lease contract
Farmer
Processor
Long-term raw materials supply contract
Source Rabo India Finance, A. Datta, 2007
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Agribusiness risks are complex
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New mitigants are required
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Financial dimensions of a value chain
Chain with small farmers and small retailers
Chain with small farmers and large institutional
processor or retailer
Source Modern Value Chains, K Schwedell
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Case Passion fruit from EthiopiaAn outgrower
incubator approach based upon foreign investment

• Five experienced Dutch entrepreneurs studied the
  potentials of Ethiopia and decided to invest
  almost 12 million in a new enterprise to buy,
  rehabilitate and expand an existing state-owned
  fruit farm in the Upper Awash region of Ethiopia.
  It is a new venture that has set targets to
  become a major producer and exporter of tropical
  fruit juices, purees and concentrates from select
  countries in Africa to the large markets of
  Europe and the Middle East.
• An integral part of the project is the active
  promotion of an Outgrower Scheme, which will
  result in new producer cooperatives (in total
  approx. 1300 hectares) to become suppliers to the
  new processing plant, in effect giving the local
  farmers efficient access to export markets and
  much improved access to commercial financing

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Ethiopia Project Location
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Ethiopia Schematic of end objective
collateral
equity
Fruit
Community Trust
Juice products
dividends

Fair Trade premium
Social development
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repayments
Export market
banks
coop union
aJ processing
loans for growth
prod. coop1
prod. coop2
etc
opportunity
inputs support
Micro finance
aJ plantation
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Case Cooperative Banana Farmers in Peru

• Banana farmers in Northern Peru organized in a
  cooperative take up pre-export processing and
  fair trade certification. Whereas historically
  they supplied large multinationals, they now do
  the quality control, washing, packaging and
  exports by themselves, thus almost doubling farm
  incomes.
• CEPIBO is a Union of Small Producers of Organic
  Bananas in Northern Peru established in 2007. It
  represents 1500 small producers of bananas with
  an average of approximately one hectare each. It
  is responsible for marketing of organic products
  (both locally and exports) and it has the
  organizational and technological capacities that
  allow them to promote fair trade throughout the
  commercial chain and diversify the productive
  system in a sustainable manner.

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Cooperative Banana Farmers in Peru
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Case Women milk farmers, India
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Rabobank Foundation Making a difference