Abstract: This project was born out of necessity for Indupalma, a large Colombian palm oil producer, to expand its palm plantations and thus ensure its national supply of raw material, as well as contribute to the sustainable development of the region where it operates, namely Magdalena Medio, a conflict-affected region. The business model integrates local farmers to Indupalma’s value chain by helping them become owners of their plantations.
Farmers are organized into ‘autonomous entrepreneurial units’, i.e. legal entities through which former day laborers become land owners and Indupalma suppliers. In addition, the company provides technical assistance to ensure quality of the cultivations. The government is also providing -through an ‘agricultural guarantee funds’- a financial incentive representing 40% of the needed investment for purchasing the land, while banks provide long-term credit to the farmers using the contractual obligation of Indupalma to buy the farmers’ cultivation as loan guarantee. Click here to read more…
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