Altus Renewables
Altus Renewables specialises in the production and marketing of bio-mass based fuels for the regeneration of renewable energy.
Need
After being contracted by a Japanese customer to export densified wood pellets from Australia, Altus Renewables needed finance to fill the liquidity gap between supplier and contract payments.
Solution
Our $5m Export Line of Credit Facility enabled Altus Renewables to purchase the materials needed to begin manufacturing while meeting contractual payments on time with their Japanese customer.
Altus Renewables produces and markets biomass-based fuels. It converts wood-based waste into densified wood pellets and absorbents for domestic and industrial use. Around 95 per cent of its operations are export-based.
In June 2020, Altus Renewables commenced a long-term agreement with a large company in Japan. Over a 10-year period, 110,000 metric tonnes per year of wood pellets will be exported from its production facility in Queensland into the Japanese market. Once shipped, the pellets are used as fuel by power stations to help the country meet its emission reduction targets.
The financial assistance from Export Finance Australia was significant in more ways than one. It will allow Altus Renewables to complete the upgrading of its facility for greater capacity and enable it to complete the construction of a dedicated storage and export facility at the Port of Bundaberg.
“We already had a relationship with Export Finance Australia, and we had kept them informed of our progress. But locking in the long-term offtake agreement was an important step for us as it enabled us to progress a funding application with Export Finance Australia,” said Denis Waddell, Chairman of Altus Renewables.
Historically, the company has found it hard to find funding sources. “Our major challenge has been that we effectively started a new export industry in Australia,” explained Denis. “Raising funds has proven difficult because people don't understand what we do; they don’t understand the application of pellets as a renewable energy.”
Export Finance Australia has provided a very important finance source,” said Denis. “Their assistance has been extremely helpful in enabling us to ramp up the plant production levels, increase our inventory levels and meet our export commitments to third parties. I'd definitely recommend approaching Export Finance Australia to assist in the development of new export projects.
Denis Waddell
Chairman, Altus Renewables
Support for business growth
Export Finance Australia provided Altus Renewables with the working capital it needed to support and fast-track its significant growth plans.
Altus Renewables’ Managing Director and CEO Ian Sandeman added that the renewable energy sector is growing at a rapid pace around the world – providing great opportunity for Australian businesses and the wider economy.
“In 2007, there were around six million tonnes of pellets produced worldwide, now we’re heading to around 50 million tonnes by 2025. It’s huge and it’s growing. In Australia, we fly under the radar but there are emerging opportunities coming our way. We’re fully expecting the market to get much bigger than it currently is.”