LUSAKA, May 13 (Reuters) – Zambia Sugar Plc (ZSC.LZ), the country’s largest sugar producer, said it plans to more than double output in the year to end-March 2010 after expanding its plantation and factory and buying a new farm.Company Secretary Lovemore Sievu said in a statement to shareholders seen by Reuters on Wednesday that sugar production would rise to more than 420,000 tonnes in the current season from 192,186 tonnes in the year ended March 2009.
Zambia Sugar, listed in Lusaka, is a unit of South Africa’s Illovo Sugar (ILVJ.J).
“Given normal weather conditions for the balance of the season, sugar production is expected to exceed all previous records and is anticipated to (be) in excess of 420,000 tonnes for the year,” Sievu said.
Zambia Sugar exports sugar to eastern African nations in the Great Lakes region and the European Union (EU).
Sievu said sugar production for the year to end-March fell from the 233,569 tonnes produced the previous year, partially due to late commissioning of the first phase of the expansion programme owing to heavy rains early last year.
“This was compounded by delays in the commissioning of new equipment, protracted electricity interruptions and disappointing factory performance,” Sievu said.
Sievu said the first phase of the expansion at Nakambala Estate, Zambia Sugar Plc’s plantation, had been completed on schedule, and the factory commenced operations in April.
Record cane yields are anticipated from the expansion areas, and the factory’s capacity has increased by 60 percent, he said.
Illovo Sugar (Z) Ltd, a sister company of Zambia Sugar, said in a separate statement that it had reached a deal to acquire 85.73 percent of the shares in Nanga Farms from Zambeef Plc, a company listed on the Lusaka Stock Exchange.
The company will pay 156 billion kwacha ($33.80 million) for the stake, it said in the statement.
The balance of the shares in Nanga Farms, a major commercial farm which grows sugar cane and sells to Zambia Sugar Plc, is owned by the government of Zambia.
Other Zambian producers are Kafue Sugar and Kawambwa Sugar. (Reporting By Shapi Shacinda)
© Thomson Reuters 2009 All rights reserved.