This summer's heat waves in northern Italy have reached an unlikely balance sheet, namely, the warehouses where regional lenders store ageing cheese as security for the money they advance to dairy farmers.
Credito Emiliano, known as Credem, has taken unmatured or young wheels of Parmigiano Reggiano as collateral since 1953. Its subsidiary, Magazzini Generali delle Tagliate, matures the cheese in Reggio Emilia and Modena, holding more than half a million wheels worth well over €300 million.
Producers receive 60% to 80% of a wheel's value upfront because Parmigiano must age at least 12 months and often 24 or 36, tying up cash small dairies cannot spare.
Blockchain now lets farmers pledge wheels while the cheese stays in their own facilities, doubling the bank's lending capacity.
However, keeping that inventory at the right temperature has become markedly riskier.
