ESA invests E110m in sugar bagging facility
MBABANE – To boost competitive edge and profitability, Eswatini Sugar Association (ESA) has taken a bold step in the right direction.
The organisation has invested a whopping E110 million in the construction of a state-of-the-art sugar bagging and warehousing infrastructure at Ubombo Sugar Mill. Its construction was completed around July 2021 by Stefanutti Stocks, which was awarded the main tender. One of the sub-contractors that played a crucial role was IFA Engineering, a company based in Big Bend that was established by a former Boiler Maker at Ubombo Sugar.
Many emaSwati got employment opportunities during the construction phase that lasted for about 12 months.
Defines
ESA’s Chief Executive Officer (CEO) Dr Phil Mnisi defines this huge investment as part of the industry’s initiative to drive more local value addition for its sugar. Dr Mnisi explained that the facility was enabling ESA to bag the sugar that was previously sold in bulk form.
“The bulk sugar was sold to markets overseas for refining, which was generally of lower value and thus paid at lower prices,” he said.
Strikingly, the CEO highlighted that the bagged sugar received a generally better price than bulk sugar not only because of the value-added in it, but because it is for direct consumption. It does not require further processing.
“In addition, bagged sugar is sold to the domestic and regional markets, which generally realise better returns than the export markets. This is supportive of the ESA strategy to penetrate more regional markets and create more value for the stakeholders,” Dr Mnisi clarified.
Commenting further about the competitive edge brought about by bagged sugar, Dr Mnisi approved that delivering sugar in a food safety compliant environment created a significant competitive edge for his organisation over other countries in the SADC region and globally.
According to Dr Mnisi, notwithstanding that bulk sugar is produced at the same grade as that intended for bagging, the former is dumped on the floor, consequently reducing its commercial value.
“Bagged sugar can be supplied to a variety of value-adding outlets, including manufacturers who would ensure that local sugar stays local,” he said. Another benefit brought about by the facility to the sugar association is notable increase in its product offering, both in terms of pack sizes and also the ability to increase the production of Nucane (low GI brown sugar).
“This sugar is currently produced at the Ubombo Sugar Mill because it is the only one with the capacity. Therefore, an improved production capacity for bagged sugar will enable increased production of Nucane sugar,” the CEO stated.
Commitment
Alongside the bagging facility, that enables ESA to supply quality sugar to the markets, is the institution’s commitment to ensure customer satisfaction.
ESA has implemented a robust customer engagement programme aimed at ensuring that the markets are supplied with sugar products that meet the required specifications.
ESA’s sugar is accompanied by a certificate of analysis (COA) authenticating that the sugar has undergone specified testing. It also confirms that the product meets the agreed specifications and is safe for human consumption.
Another milestone in ESA’s history is the completion of the first-ever sugar testing laboratory in the country. The association collaborated with the University of Eswatini (UNESWA) towards this initiative.
Procurement
ESA’s initial commitment to the project was E1.6 million, which has largely gone to the procurement of equipment and instruments while UNESWA provided the building, furniture, fittings, personnel and consumables.
Although it might take some time to get this lab accredited and operational, Dr Mnisi is optimistic that there will be a cost-saving and retention of some of the funds currently going out of our economy. “It is important for the country to build its own capabilities in various spaces, especially scientific and technological areas.
These capabilities include human resources and technology infrastructure. Infrastructure such as a laboratory enhances the investment and attractiveness of the country as most investors seeking opportunities require such facilities for their products,” Dr Mnisi said.