KENYA – Seal Sugar Mill, a local Kenyan firm is seeking the approval of the environmental watchdog, National Environment Management Authority (Nema), to construct a new sugar factory in Siaya County.
The factory to be established on 18,400 acres of land will have an initial milling capacity of 1250 tonnes of cane per day (TCD) to be expanded to 2,500 tonnes of canes per day in future.
In addition, Seal Sugar Mill will use fresh bagasse to produce about 3 MW of power at its station.
However, the power station will only be able to utilise a fraction of the fresh bagasse daily out of the quantities produced from crushing of cane per day, reports Business Daily.
The company says the sugar mill will improve the livelihoods of the local population by creating 1,200 jobs and establish small-holder and out-grower support schemes.
It will also cut post-harvest losses by reducing the distance it takes to transport cane, the firm says.
Plans for the new sugar factory come at a time when Kenyan industrial conglomerate, Rai Group, is set to commence operations at its newly built sugar production unit, Naitiri Sugar Company, by the end of the first quarter of this year.
Built at a cost of Ksh 5 billion (US$44m), the facility is expected to commence with a processing capacity of 3,000 tonnes of sugar cane which will eventually be doubled to 6,000 tonnes, reports Ecofin Agency.
The new factory will further extend Rai’s hold on the Kenyan sugar market where it already controls nearly 45% of total sugar sales through three companies: West Kenya Sugar, Sukari and Olepito.
Mushrooming of new mills
There has been an increase in new sugar factories due to failed traditional millers and rising demand for sugar across the country.
Kenya currently has almost 15 sugar millers with new additions such as Busia Sugar, Kwale International and many more.
This proliferation of millers has heightened competition in the sector as the players scramble for the limited supply of cane in the country.
According to a recent GAIN report by USDA, sugar production in Kenya is expected to increase by 8 percent in Marketing Year (MY) 2021/22 to 650,000 metric tonnes (MT) due to an increase in sugarcane yields following good weather conditions, better agronomic and harvesting practices.
During the period under review, consumption is expected to increase by 5 percent in MY 2021/22 to 1 million MT, with the deficit offset by imports.