Illovo commits K3bn in capital projects

Illovo Sugar Malawi Limited has committed K3 billion (about $12 million) to capital projects in both the agricultural and factory operations.

The investment aims to secure the on-going growth and future sustainability of the sugar business in the country.

In an e-mailed response, Illovo spokesperson Ireen Phalula said this will ensure continuous availability of domestic sugar supplies and moderation of prices, among other things.

“Malawi prices are the lowest in the region. Although the company is always under pressure with regard to costs of production and marketing, we have, through continuous improvements, been able to successfully maintain moderate prices which, as said above, are the lowest in the region,” Phalula said.

She said the K3 billion ($12m) will be spent on a range of things, including replacement of equipment such as irrigation pumps, some electrical improvements and buildings at both Nchalo and Dwangwa Sugar Estates.

“Capital expenditure is also on productivity and efficiency developments such as irrigation pivots, production improvement projects and energy saving initiatives in factories,” said Phalula.

During the company’s annual general meeting held recently, Illovo chairperson, Graham Clark said investments in factory capital projects, coupled with continuous improvements in plant efficiencies in the new season, should ensure improved rates of factory throughput and recoveries.

He argued that this would augur well for an improvement in overall sugar production which is expected to increase by almost 10 percent.

Illovo has also announced plans to develop more than 400 hectares of additional cane land by Malawian smallholder farmers, particularly in the Chikhwawa area.

This too is expected to result in an increase in the overall cane crop.