Zilor Cogen (IFC-47633)

Countries
  • Brazil
Geographic location where the impacts of the investment may be experienced.
Specific Location
City of Lençois Paulista
Whenever identified, the area within countries where the impacts of the investment may be experienced. Exact locations of projects may not be identified fully or at all in project documents. Please review updated project documents and community-led assessments.
Financial Institutions
  • International Finance Corporation (IFC)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Proposed
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
B
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Borrower
ACUCAREIRA QUATA S/A
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Agriculture and Forestry
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Loan
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 30.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Project Cost (USD)
$ 30.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Primary Source

Original disclosure @ IFC website

Updated in EWS May 31, 2024

Disclosed by Bank May 24, 2024


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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

Zilor, established in 1946, operates in two business divisions: (i) agroindustry, specializing in the production of Very High Polarity (VHP) sugar, hydrous and anhydrous ethanol, and electricity generation from bagasse; and (ii) biotechnology, focusing on food additives under the Biorigin brand. Zilor has three agro-industrial units in the state of São Paulo (São José in Macatuba, Barra Grande in Lençois Paulista, and Quatá in Quatá), three Biorigin plants in Brazil and one in the United States, and distribution centers in Brazil and Belgium. The company's annual crushing capacity is 12 million tons. In 2023, Zilor achieved 10.6 million tons of crushed sugarcane, 695 thousand tons of sugar, 451 thousand cubic meters of ethanol, 43 thousand tons of food additives, and 490 thousand Megawatt-hours (MWh) of electricity sold. Zilor sources sugarcane from 35,000 hectares (ha) of owned land and 145,000 ha of leased land. All sugarcane harvesting is mechanized. The plantation is managed either by Zilor or by sugarcane producers, known as agricultural partners. The company has a workforce of 3,200 individuals, including 2,700 permanent and 500 seasonal employees, with 15% being women. Furthermore, over 4,000 workers are engaged in the operations of the company's partners. IFC’s proposed investment is a loan of up to US$30 million for the expansion of Zilor's electricity cogeneration capacity from 199 MW to 319 MW (the Project). This expansion entails the installation of a more efficient boilers and turbogenerators at Barra Grande (https://maps.app.goo.gl/thK6WBHVMqRHshdf7) unit, without an increase in the sugarcane plantation area. Furthermore, a 23-km 138-kV transmission line will connect Barra Grande to the Barra Bonita energy substation (https://maps.app.goo.gl/m4ewDvyoHd89wsbe6). The execution and operation of this transmission line fall under the oversight of the Companhia de Transmissão de Energia Elétrica Paulista (CTEEP). The expansion project at Barra Grande is currently in progress, with an anticipated completion date set for May 2024, aligning with the start of the sugarcane harvesting. The area of plantations that supply sugarcane to the Barra Grande are 62,000 ha, including 42,000 ha managed by 16 agricultural partners and 20,000 ha managed by Zilor. Sugarcane acquired from the spot market or independent producers constitutes less than 3% of the overall volume, respectively. The average distance from sugarcane plantations to the mill is estimated at 22 km. The nearest town to  the Barra Grande mill is Lençóis Paulista (population of 68,000), situated 3 km to the West, along with other smaller settlements like Areiópolis, Macatuba and Pederneiras, which are located within the mill’s sugarcane sourcing area.

Investment Description
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