The Brazilian Development Bank (BNDES) announced to provide 59.4 million real (USD 17 million) to Tanac S/A for the construction of a wood pellet factory in Rio Grande do Sul. The plant is going to be Latin America’s biggest wood pellets production site with its produce destined for exportation.
According to Tanac S/A, the construction of the factory started in October 2014 and is supposed to be completed by early 2016, with its pellets exportation scheduled to start in mid-2016.
The measure is considered discriminatory since, in general, the Brazilian Development Bank provides credits with below-market interest rates only to legal persons (private or public) based in Brazil. In the abovementioned loan, the interest rates are at 7 percent per annum for SMEs and 9.5 percent per annum for all other types of enterprises, whereas the Central Banks overnight interest rate is at about 14 percent.