Brazil development bank says money for ethanol COVID-19 support depends on consortium of banks

In Brazil, EPBR reports that the Brazilian Development Bank, BNDES, does not have the resources to fulfill the financing line demanded by the ethanol sector to help with the Covid-19 impact of drastic price and demand drops for ethanol and that the initiative will depend on a consortium of public and private banks.

“We don’t know if the ethanol storage line will be released. We are waiting for definitions from the Ministry of Economy, to see if it puts the sector as a priority”, said Mauro Mattoso, head of department of Agro-food Complex and Biofuels Area of Industry and Services BNDES, according to EPBR.

It will be up to the Ministry of Economy to elect priority sectors that should be supported, due to the public health crisis of covid-19.

The president of Unica, Evandro Gussi, who represents major ethanol and sugar producers, says he needs financing for a quarter of production, a credit of the order of R $ 9 billion, to support the storage of a quarter of the crop’s production 2020/2021. “What we are asking for is a financial market solution, which is a financing designed by official banks that can cope with this beginning of the harvest, when there is the greatest expenditure of resources, giving as guarantee ethanol in sealed tanks, supervised by controllers first-rate, ”said Gussi in an interview with Reuters.