The International Finance Corporation (IFC) is providing up to $35 million to Tanveer Food Limited (TFL), a subsidiary of the Meghna Group of Industries (MGI), to promote a resilient rice market in Bangladesh.

The fund is expected to help ensure food security and improve the incomes of more than 123,000 smallholder farmers, especially women.

The investment marks the IFC’s first under its Global Food Security Platform (GFSP), a $6 billion global financing facility set up to counter the global food crisis by restoring and improving production to build the foundation for a more resilient global food system.

The investment includes $21 million from the IFC’s own account as well as a subordinated loan of up to $14 million from the Private Sector Window of the Global Agriculture and Food Security Program (GAFSP).

The funding is said to help the TFL establish a state-of-the-art automated rice mill in the Bogura region, with a processing capacity of 1,000 tonnes per day producing over 170,000 tonnes of quality packaged rice by 2027.

It will also enable the construction of an 80 MTPD rice bran oil plant and a husk-based cogeneration plant – for heating and electricity – contributing to climate mitigation and resilience to volatile energy costs during production.

“This investment will allow us to expand the processing, and distribution of rice products in northern Bangladesh, a region that has traditionally been composed of a large

number of smallholder farmers growing rice to earn their livelihoods,” said Tahmina Binthe Mostafa, Director of MGI.

“Driven by the growing demand for packaged rice with increased income and evolving consumer choices, we will contribute to the modernisation of Bangladesh’s rice milling sector by shifting from traditional husking mills to automated mills, which are key to improving the rice quality and increasing the shelf life of packaged rice.”

While Bangladesh is the third largest rice producer in the world, with rice the main staple and a vital source of calories, the country faces acute food security risks triggered by surging food and energy prices due to the Russia-Ukraine war.

“In a country like Bangladesh, food security means rice security,” said Riccardo Puliti, IFC’s Regional Vice President for Asia and the Pacific.

“Through building a state-of-the-art rice milling factory this project will deliver hundreds of jobs and put more money into the pockets of thousands of the country’s smallholder farmers. More importantly, this rice project in Bangladesh, along with others in the pipeline, will enable the global food supply market to better withstand price and supply shocks, building a more resilient future for the benefit of consumers and farmers.”

The investment will further increase smallholder rice farmers’ access to the market, introduce spot payments, shorten storage period of rice, reduce waste, and improve the quality of rice paddy.

IFC will also help the company strengthen its environmental and social standards, aligning its operations with industry best practices including a farmer’s training programme.