Green loan

About the farm

The farmer has been farming since 2007, when he leased 17ha of land on his own. Since then he has managed to expand the farm to 97ha of which he owns 20ha. The farmer on the farm works independently and is engaged in crop production and breeding beef cattle. His sowing structure is 12ha of winter wheat, 7ha of winter triticale, 3ha of winter barley, 6.5ha of spring barley, 20ha of corn for silage, 32.5ha of corn for grain. His herd consists of 92 bulls up to 12 months and 90 bulls up to 24 months.

On the farm he uses machinery such as:

• URSUS tractor 2016
• ALIMA BIS feed truck 2018
• AMAZONE seeder 2016
• AMAZONE seeder 2015
• SAMASZ bale wrapper 2018
• AGROMASZ disc harrow 2017
• ALIMA manure spreader 2014
• URSUS baler 2017
• KRUKOWIAK sprayer 2011

In the next 3 years, the farmer plans to further develop his beef cattle farm, wants to increase his herd to 300 head, and plans to start growing rapeseed, soybeans, sunflowers. The farmer has applied for the purchase of new machinery from the agency program to modernize his machinery fleet. The loan funds are to be used to purchase fertilizers, seeds and crop protection products.

Main Terms

The principal will be repaid by the farmer in regular instalments over the span of 4 years in accordance with the repayment schedule.

65 hectares of land are included in the Green Loan program. It is estimated that a total of 657 carbon certificates will be generated in 5 years (based on a conservative estimation). Consequently, investors will receive below indicated portion of sales proceeds from every carbon certificate generated from the land of the project owner involved in the program;

(1) 60% of income received during the loan period;

(2) 40% of income received for the following year after the loan period.

It is expected that the first carbon certificates will be generated and sold in the second quarter of 2026. The exact return will depend on the amount of sequestered CO2 levels and the sale price of the carbon certificates.

If the project owner (farmer) withdraws from the Carbon Credits Agreement and does not intend to follow the agreement on the carbon revenue split with investors, the project owner will be obliged to repay the entire loan as well as pay the penalty, calculated by multiplying the interest rate by the entire loan amount and period equal to the duration of the loan agreement plus 12 (twelve) months.

Investors of this loan would receive a penalty of 25000 EUR * 12% * 5 year = 15000 EUR. This penalty can be reduced by the return earned by investors from the carbon credits generated

If the project fails to be delivered successfully through no fault of the farmer, the farmer commits to paying investors a minimum interest rate of EURIBOR 6M + 1.5%. This commitment applies in situations such as the lack of market demand for selling carbon credits, among others.

Annualized return forecast

Conservative scenario (€20 per carbon certificate): 16,36% IRR*

Today's scenario (€35 per carbon certificate): 25,9% IRR*

Optimistic scenario (€100 per carbon certificate): 57,22% IRR*

Read more about the return scenarios in the document section

*The internal rate of return (IRR) is a metric used in financial analysis to estimate the profitability of potential investments. Learn more about it

Keep in mind that the return forecast is an estimation and does not guarantee you the returns mentioned above.