EBRD Bolsters Seed Company’s Resilience Through Climate and Earthquake Initiatives

EBRD Bolsters Türkiye‘s Agricultural Resilience with €20 Million Loan to MAY Seed

ISTANBUL, TURKIYE – The European Bank for Reconstruction and Growth (EBRD) has provided a meaningful €20 million loan to Türkiye’s leading seed producer, May Agro Tohumculuk, Sanayi Ve Ticaret Anonim Şirketi (MAY Seed). The funding aims to bolster the company’s working capital and capital expenditure needs, particularly in the wake of the devastating 2023 earthquakes that disrupted its sales, supply chains, and logistics operations.

The financial injection will also support MAY Seed’s ongoing commitment to developing innovative crop varieties that exhibit increased resilience to climate change-related stresses.This strategic investment underscores the EBRD’s dedication to fostering enduring agricultural practices and ensuring food security in the region.

With the EBRD’s partnership, MAY Seed is empowered to continue its critical work in assisting farmers to cultivate and distribute climate-resilient seed varieties, thereby revitalizing the agricultural supply chain despite the significant challenges posed by the earthquakes.

MAY Seed stands out as one of Türkiye’s foremost local seed producers, distinguished by its extensive seed-breeding and research and development (R&D) programs.The company pioneered climate change-resilient seed development in Türkiye, launching its first R&D initiatives in 1997, making it the first private local producer in the country to embark on such enterprising programs.

“We commend MAY Seed for its pioneering efforts in seed production R&D, driving innovation in climate resilience and adaptation to safeguard global agriculture,” stated Natalia Zhukova, EBRD’s Head of Food and Agribusiness. “Our support will ensure that the company continues to strengthen, following the disruptions caused by the devastating earthquakes. Its dedication to sustainable and climate-smart seed production remains a cornerstone of agricultural progress and food security.”

Yusuf Yormazoğlu, Co-Chairman of MAY Seed, expressed his gratitude for the long-standing collaboration. “We have enjoyed a strong and long-standing partnership with the EBRD.Considering the challenging economic conditions both globally and in Türkiye over the past five years, this financing support is particularly valuable and meaningful for us. We are truly grateful for the trust and support EBRD has shown us.It enables us not only to strengthen our company’s resilience, but also to make a more effective and sustainable contribution to both Turkish and global agriculture. By developing climate-resilient seed varieties, we aim to help secure the future of our farmers – and partnerships like this allow us to pursue that goal with even greater impact. We sincerely thank EBRD for their continued confidence in us.”

The EBRD is a key investor in Türkiye, having committed over €22 billion to 495 projects and trade finance facilities since 2009.

How does the EBRD’s green finance ratio of at least 50% contribute too the resilience initiatives for seed companies?

Strengthening Agricultural supply Chains in Vulnerable Regions

The European Bank for Reconstruction and Growth (EBRD) is actively working to enhance the resilience of seed companies, particularly those operating in regions prone to climate change impacts and seismic activity. This initiative is crucial for safeguarding food security and supporting sustainable agriculture. A key figure driving this strategy at the EBRD is Harry Boyd-carpenter, Managing Director for Climate Strategy and Delivery, who took on the role in April 2021. His focus on a green finance ratio of at least 50% underscores the bank’s commitment to climate-resilient investments.

Climate Change Adaptation for Seed Production

seed companies are at the forefront of agricultural vulnerability. Changing weather patterns – including increased droughts, floods, and extreme temperatures – directly impact crop yields and seed quality. The EBRD’s approach centers on several key areas:

Climate-Smart Seed Varieties: Funding research and development of seed varieties that are more tolerant to drought, heat, and salinity. This includes supporting breeding programs focused on genetic diversity and resilience.

Water management Solutions: Investing in efficient irrigation systems and water conservation technologies for seed production facilities. This reduces water stress and ensures consistent seed quality even during dry periods.

Diversification of Production Locations: Encouraging seed companies to establish production facilities in geographically diverse locations to mitigate the risk of localized climate disasters.

Climate Risk Assessments: Providing technical assistance to seed companies to conduct thorough climate risk assessments and develop adaptation plans.

Earthquake Resilience: Protecting Critical Infrastructure

Regions with high seismic activity face unique challenges for seed production. Earthquakes can damage storage facilities, processing plants, and transportation networks, disrupting the supply chain and potentially destroying valuable seed stocks. The EBRD’s earthquake resilience initiatives include:

Seismic Retrofitting: Providing financing for the retrofitting of existing seed storage and processing facilities to meet modern seismic standards.

Construction of Earthquake-Resistant infrastructure: Supporting the construction of new, earthquake-resistant facilities, incorporating best practices in structural engineering.

Emergency Preparedness Planning: assisting seed companies in developing comprehensive emergency preparedness plans, including seed backup and disaster recovery protocols.

Supply Chain Diversification: Promoting the diversification of transportation routes and storage locations to minimize disruption in the event of an earthquake.

EBRD Financing Mechanisms & Technical assistance

The EBRD employs a range of financial instruments to support seed company resilience:

1. Loans: Providing direct loans to seed companies for infrastructure upgrades, technology adoption, and working capital.
2. Equity Investments: Taking equity stakes in seed companies to provide long-term capital and support strategic growth.
3. Guarantees: offering guarantees to commercial banks to encourage lending to seed companies.
4. Technical Assistance: Providing expert advice and training on climate adaptation, earthquake resilience, and sustainable agricultural practices. This ofen involves partnerships with specialized consultants and research institutions.

Benefits of Increased Resilience for Seed Companies

Investing in climate and earthquake resilience offers significant benefits for seed companies:

reduced Risk: Minimizes the financial and operational risks associated with climate change and natural disasters.

Enhanced Supply Chain Security: Ensures a more reliable supply of seeds to farmers, even in challenging conditions.

Improved Product Quality: Protects seed quality and viability, leading to higher crop yields for farmers.

Increased Market Access: Demonstrates a commitment to sustainability and resilience, attracting environmentally conscious customers and investors.

Long-Term Sustainability: Contributes to the long-term viability of the seed industry and the food system as a whole.

Case Study: Supporting Seed Production in[Region-[Region-Specific region example needed for a real case study]

While specific details require further research, a hypothetical example illustrates the EBRD’s impact:

In [Region], a seed company specializing in drought-resistant wheat varieties received an EBRD loan to upgrade its storage facilities and implement a water-efficient irrigation system. The project included seismic retrofitting of the existing warehouse, ensuring its structural integrity in the event of an earthquake. Following the upgrade, the company experienced a 20% increase in seed production efficiency and a significant reduction in water consumption. This allowed them to expand their market share and contribute to food security in the region.

Practical tips for Seed Companies

Seed companies can proactively enhance their resilience by:

Conducting regular risk assessments: Identify potential climate and seismic hazards and their potential impact on operations.

Investing in climate-smart technologies: Adopt water-efficient irrigation, drought-resistant seed varieties, and renewable energy sources.

Developing emergency preparedness plans: Establish clear protocols for responding to climate disasters and earthquakes.

Diversifying supply chains: Reduce reliance on single suppliers and transportation routes.

Seeking technical assistance: leverage the expertise of organizations like the EBRD to develop and implement resilience strategies.

Resources for Further Details

European Bank for Reconstruction and development (EBRD): https://www.ebrd.com/

**World Economic Forum