The Situation

Prograin Organic cultivates processes, stores, and trades organic grains, seeds, and pulses in the Republic of Moldova. Together with a group of Moldovan farmers who believe in the value and sustainability of organic farming, Prograin is committed to supplying high-quality organic products that restore soil health, improve farmers’ incomes and resilience, and generate economic opportunities in rural areas. In March 2019, their certification body (called Control Union) lost its EU certification license in Moldova and therefore had to reach out for a new certifier. The certification process was slower and more complex than expected. In the meantime, organic corn and wheat prices were dropping as more and more farmers in France and Germany turned to organic agriculture to serve their clients in Western Europe.

The Roadblock

In December 2019, Prograin found a Spanish client that was willing to purchase 2,500 tons of product. As part of that deal, 50 percent of payment would be held until the product was released by the local authority. This payment delay created a liquidity challenge; farmers were expecting payment and the seeding campaign of the new harvest was about to start. The farmers were only willing to join the organic campaign at the new seeding season after 2019 harvest payments were received.

Open Road's Response

A loan of $400,000 from ORA enabled 48 farmers to cultivate Prograin purchases, including wheat, spelt, sunflower, peas, oat, corn, and soybeans. The opportunity for growing organic was maintained and the additional income generated was preserved for the farmers and beneficiaries. Corn comprises roughly 35 percent of their total crop volume and 15 to 30 percent of their sales volume. The price that farmers were paid for organic corn in 2019 was 15 percent above the conventional corn market price. 

To learn more visit: prograin.ca