ImpactAlpha, May 20 – Ejido Verde is using forest conservation as an opportunity to empower indigenous families in the Mexican state of Michoacán. The decade-old company has gotten a $2 million loan from IDB Invest to build and maintain 1,250 hectares of native pine trees on communally-owned indigenous lands, known as ejidos.
At the core of Ejido Verde’s business is pine resin, which is used to make inks and glues. Mexico is the world’s fifth-largest resin producer in the $10 billion global market. Ejido Verde supports the sustainable production of pine resin by lending capital to indigenous communities to plant new trees and procure the resin when the trees mature, after about 10 years. Communities repay the loan with 10% of the resin they procure and Ejido Verde buys the remaining supply at a fair market price.
The company’s model both provides livelihoods for underserved indigenous families and also repopulates Mexico’s pine trees, which had been over-harvested. It has supported 480 family farms on 11 ejidos plant 3,000 hectares of trees.
“The trees we plant today will create revenue and jobs for the next three generations,” Ejido Verde’s Shaun Paul told ImpactAlpha.
IDB Invest’s commitment is the first time Ejido Verde has received investment from “a mainstream financial institution,” Paul said in a statement. “Until now, we have secured investment from industry insiders, Kiva, and friends and family.”
The investment will support the company’s goal of establishing and restoring 12,000 hectares of land with native pine trees by 2022.