Tanzania: Bakhresa Sh700bn Sugar Project to Start June 2022

Dar es Salaam — The Said Salim Bakhresa Group of Companies (SSBG) said recently that its $300 million (about Sh690 billion) Bagamoyo Sugar Ltd will officially start production by June next year (2022).

Bakhresa Group corporate affairs director Hussein Sufian said almost $100 million (about Sh230 billion) has so far been used in constructing the first phase of the project.

"We are putting the finishing touches to the civil works," Mr Sufian said yesterday - adding that construction of the first phase will cost around $110 million.

He expounded that already the construction of premises for production machines is complete.

"We have just started installation of the machines," he said, noting that normally the process would take between six and nine months.

"We are optimistic that the installation of machines will be ready by December this year, or January next year at the latest."

From there on, he said, they would start trial production of sugar before embarking on commercial production in June.

The project, which has three phases, is expected to start with an installed capacity of between 30,000 tonnes and 35,000 tonnes.

"That factory is expandable; it can go up to an annual production capacity of 100,000 tonnes upon completion of all the three phases," said Mr Sufian.

Bagamoyo Sugar Ltd is significant to job creation and will in future have a multiplier effect on farmers. The first phase of the factory will create between 800 and 1,000 direct jobs.

"We have a farm and to start with, on which we will cultivate 2,000 hectres of sugarcane," he said. However, in future he said they would also use an out-grower scheme.

The decision to establish Bagamoyo Sugar Ltd came after the late President John Magufuli allocated 10,000 hectares of land to the business tycoon, Mr Said Salim Bakhresa, to establish a sugar plant.

Requesting the Parliament to approve Sh105.670 billion for the 2021/22 fiscal year for his docket, the minister for Industry and Trade, Prof Kitila Mkumbo, said that, in an effort to narrow the deficit gap, the government is putting more efforts in attracting investment in sugar production.

He said Tanzania's five sugar factories - namely: Kilombero Sugar I and II; Mtibwa Sugar Limited; Kagera Sugar Limited; TPC Moshi and Manyara Sugar Company Limited - have a collective annual capacity of producing 462,863 tonnes against the demand of 635,000 tonnes (470,000 domestic and 165,000 industrial sugar).

This means that the country has a deficit of 172,137 tonnes.

Prof Mkumbo also said that, in a bid to close the deficit gap, the government - acting through the Sugar Board of Tanzania (SBT) - permitted sugar producers to import 40,000 tonnes of the commodity in the 2020/21 season.

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