Ulaanbaatar
Promissory Notes in the Cashmere Sector: A New Financial Instrument for the Agricultural Industry
Economy
Ulaanbaatar, June 24, 2025 /MONTSAME/. On June 23, 2025, the Ministry of Food, Agriculture, and Light Industry (MOFALI), the Mongolian Commodity Exchange, commercial banks, and factories signed contracts to secure funding through promissory notes, aiming to increase cashmere sales and support the export of combed cashmere.
State Secretary of the MOFALI Jambaltseren Tumur-Uya
remarked, “The Government’s policy to fully process livestock-derived raw
materials, regarded as 'white gold', and add domestic value is being
implemented successfully. A total of 5,000 tons of raw cashmere has been
prepared using the discounted working capital loans of USD 330 billion for businesses
within the framework of the “White Gold” National Movement and with companies’ own
sources. It was the first time that Mongolian domestic factories managed to
prepare 50 percent of all raw cashmere needs.
As reflected in Cabinet session notes, the Government considered
it proper to introduce promissory notes as an additional financial instrument
to foster stable production operations, safeguard herders’ cash incomes, and
address challenges related to raw cashmere processing. This significantly
boosts the efforts to overcome financing challenges. Stable production will
ensure our herders’ incomes and our competitive edge in the global cashmere
market. The phased advancement of the domestic processing level of our main
non-mining export goods – wool and cashmere – will increase the production of
value-added final goods and consequently boost export income. I would like to
emphasize that the issuance of promissory notes in the cashmere sector marks
the introduction of an innovative financing instrument in the agricultural
industry.”
Promissory notes worth MNT 7 billion each were signed
between “Golomt Bank” and “Gobi” JSC, and between “Khan Bank” and “Khanbogd
Cashmere” LLC. This confirms the promissory notes as funding sources,
regulating payment relations between the sides, and defining their rights and
responsibilities.
Financing sources for raw material procurement, aiming at
supporting cashmere processing and production have been secured within the
framework of the implementation of the “White Gold” National Movement initiated
by President of Mongolia and the State Great Khural’s Resolution No. 63 in 2024 “About Some Measures
to Support Livestock-Derived Raw Material Production”, and in line with Resolution
No. 09 in 2025 by the Standing Committee on Environment, Food, and Agriculture
of the State Great Khural and the Cabinet Session Notes on April 23, 2025.
