Key stakeholders in Nigeria’s sugar industry are said to be ramping up investment to the tune of $2.6 billion following a significant increase in demand.
Sugar demand reached 2 million metric tons at the end of 2013. This is 500,000 metric tons more than the 1.5 million metric tons requested in 2012, according to information by the National Sugar Development Council (NSDC).
The demand has drawn significant interest from the industry’s big players who are keen to exploit the growth for greater profit margins and increased market share.
Dangote Sugar, one of Nigeria’s leading providers, is investing $2 billion following the acquisition of Savannah Sugar in Adamawa State, Northern Nigeria.
It aims to fund an expansion project that will raise output to 1.5 million metric tons by 2018. This will be achieved by increasing the capacity of its sugar plantation from 6,500 hectares to 21,000, which will boost production to a 100,000 tons of sugar annually.
Another player, HoneyGold Group, plans to invest $300 million in two sites in Adamawa, with production capacity of 200,000 tons annually. Other investors are Confluence Sugar Company and Crystal Sugar Mills, which are planning to invest $240 million and $30 million respectively.
These investments will reduce the country’s dependence on sugar importation, which has been costing millions of dollars. It will also encourage participation of local sugarcane farmers who have previously complained of low patronage, thus boosting the nation’s economic growth.
Source: ventures-africa.com
