Uganda Sugar Producers Plan to Invest $197 Million in Expansion

 

April 05, 2011, 7:46 AM EDT

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By Fred Ojambo

April 5 (Bloomberg) -- Uganda’s three main sugar producers plan to spend a combined $197 million to boost capacity and diversify their operations, the Uganda Sugar Cane Technologists Association said.

Kakira Sugar Works, the East African nation’s biggest producer of the sweetener, will invest $100 million to expand its sugar and electricity generation capacity, and production of ethanol, the Kampala-based association said in an e-mailed annual report today. The company, which is expected to produce 165,190 metric tons of sugar this year, plans to complete the expansion and the power plant by June 2012, the agency said.

Sugar output in Uganda may climb 18 percent to 350,000 tons this year, with 99 percent of the output coming from plants owned by Kakira, Kinyara Sugar Works Ltd., and Sugar Corp. of Uganda Ltd. according to the report. The East African nation, which consumes 346,000 tons of the sweetener, imported 130,000 tons last year, of which 67,590 tons was re-exported, it said.

Kakira, which generates 22 megawatts of electricity from cane fiber known as bagasse, plans to boost that capacity to 50 megawatts, which will enable it to supply 30 megawatts to the national grid, the agency said. The company has yet to determine when to open its ethanol distiller, the report said, without providing further details on either of the projects.

Kakira is owned by Madhvani Group, which says it is Uganda’s biggest industrial group.Continued