mobilizing capital to scale responsible expansion of crop livestock in brazil

18 Multiple factors can affect the payback period and the yield recovery for the producer: Furthermore, there is a need for long-term results evaluation in agriculture, considering the inherent short-term variability deeply tied to climate risks.Initial Condition of the PastureType of Recovery Practices UsedMarket Prices for ProductsClimatic Condition Soybean Prices Brazil, USD/sack (60 kg) 20133028 212221 2219223136 292015 2017 2019 20212014 2016 2018 2020 20232022 Source: CEPEABrazil Soybean Yields Brazil, ton/ha 2.93.02.93.418%16% -14%3.5 3.3 3.43.5 3.03.5 3.42013/14 2015/16 2017/18 2019/20 2021/222014/15 2016/17 2018/19 2020/21 2023/24e2022/23 Source: CONAB The different financial structures and the key role of subordinated debt Solutions may vary depending on the profile of the producer with items such as size, commodity, credit history, among other. A large producer can be financed on a standard basis relying on its own cash flow generation, but small and medium producers may not be eligible for loans on a stand-alone basis for a long tenor. Therefore, a portfolio approach with diversification of risk – e.g with securitization mechanisms - will be necessary to mitigate the credit risk. Blended finance is well adapted for this kind of structure, hence the need for catalytic capital.