US agricultural commodities firm secures $2M to enable trade with Europe

MODIFI is proud to announce a new partnership with a leading agricultural commodities firm with multiple locations across the US. The deal ensures that the company is able to take advantage of significant export growth opportunities in Europe that might otherwise have been scuppered by working capital limitations.

MODIFI's new client has experienced considerable growth, but increasing their exports became challenging due to the fact that the company's bank excludes foreign AR from its borrowing base, limiting their ability to offer credit terms to international buyers.

This issue reared its head again recently when the firm received a large and time-sensitive growth opportunity with its long time buyer in Denmark. Before working with MODIFI, all payments had to be made upfront in full before shipment could take place, restricting the international collaboration being explored between the two organizations.

After signing a deal with MODIFI, the US exporter is now able to offer its buyer up to 120 days post-shipment credit terms. The solution provides the company with the additional working capital and credit protection it needs to capitalize on a large growth opportunity with its Danish buyer. The deal is also mutually beneficial: the exporter can continue to pay its farmers in cash while its buyer can access credit terms that bridge the container shipping period.

In recent years, MODIFI has built up a reputation for being the go-to provider of export factoring services. In this case, MODIFI's ability to quickly offer non-recourse factoring that didn't impact the client's borrowing base was extremely valuable.

"We acted rapidly in what was a time-sensitive deal," Brian Dowd, MODIFI Director of Sales in the US, explained. "Our client wanted to execute its export contract as soon as possible but couldn't pay upfront, while its buyer couldn't execute without more flexible payment terms. We closed and funded the deal extremely quickly."

International trade plays an essential role in boosting consumer choice, providing new employment opportunities, and generally raising living standards. It remains a global tragedy that regulatory and financing issues continue to hamper the ability of organizations to seize their international opportunities across a range of industries - from manufacturing to agricultural commodities.

The latest deal between MODIFI and its US-based agricultural commodities client underlines the important role that financing plays in facilitating international trade. Although the hurdles can sometimes appear insurmountable, with the right support, a mutually beneficial solution can usually be found that serves the interests of businesses (and consumers) all over the world.

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Elena Ermishina
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