Tongaat in $300m expansion drive

From George Maponga in Masvingo
Tongaat Huletts Zimbabwe has started working on a $300 million project that will result in sugar production increasing by 50 000 tonnes, export earnings rising by $18 million and 2 000 direct and indirect jobs being created within the next two years.

The project, dubbed Kilimanjaro, will see Tongaat turning a total of 4 000 hectares of virgin land into cane fields.

Work on the Kilimanjaro Project started in April and is due for completion in September 2020 when the developed cane fields will be handed over to Government for allocation to indigenous outgrowers as part of a drive to empower locals.

Tongaat executive in charge of Project Kilimanjaro Mr Ushe Chinhuru on Wednesday said work on the project was progressing well following commencement on April 3 this year.

“A total of 1 825 hectares has been bush-cleared to date since project commencement on 3 April 2019. Ripping, discing, construction of storage dams, canals and associated infrastructure are in progress with the first planting expected to commence in August 2019,” said Mr Chinhuru in written responses to questions from The Herald.

Mr Chinhuru said new cane fields were being developed at Hippo Valley and Triangle Estates.

He said the project was expected to further lure investment to the Lowveld through the opening up of agriculture support industries, among other entities.

“On completion the project will be handed over to Government. An additional 50 000 tonnes of sugar per annum will be produced.

“Commercial banks are funding the project on a full cost recovery basis. Some 2 000 direct jobs will be created by the project and downstream activities, increased exports to generate at least US$18 million in foreign currency for the country. Other economic benefits include investment opportunities for related industries that include suppliers of agro-inputs, transport services, etc,” said Mr Chinhuru.

The company is this year expecting to produce 500 000 tonnes of sugar and the additional output from the project will take its production to 550 000 tonnes, which is close to the installed capacity of its two mills at Hippo Valley and Triangle Estates of 600 000 tonnes.

The country is self-sufficient in sugar, and requires about 300 000 tonnes for domestic consumption leaving the surplus for export.

In terms of exports the country is raking in US$65 million which is expected to rise to about $83 million when the project starts operating at full throttle.

The additional 2 000 jobs will consolidate the company’s position as arguably the largest single employer in Zimbabwe.

Currently, Tongaat employs close to 20 000 permanent and contract employees at its cane operations in Hippo Valley and Triangle Estates.

The programme is coming at a time when the Lowveld sugar industry is poised for expansion following the completion of the 1,8 billion cubic metre Tugwi-Mukosi Dam which is now providing additional water to irrigate existing and new cane plantations.

There have also been calls for Government to protect the local sugar industry by stopping imports as the country can produce enough for domestic consumption and the export market to rake in the much-needed hard currency.

Besides sugar, cane has other by products such as ethanol, electricity and stockfeeds which are critical in the nation’s drive to revive its beef industry and help Zimbabwe reclaim its position as a major beef producer in the region.