TPC to invest over Sh112 billion in molasses factory

What you need to know:

  • Construction of the molasses processing facility is expected to commence early next year and the plant will be located near the sugar processing factory

Moshi. TPC Limited, the oldest sugar plant in the country, will invest Sh112.5 billion for the construction of a molasses plant.

The investment follows an after-tax profit of Sh72.7 billion made by the plant during 2022/23 after making a record sales of the sweetener worth Sh235 billion.

Molasses is a byproduct of the sugar-making process and it comes from crushed sugar cane. It is a thick syrup left over after removal of the crystals from the juice.

The new investment project was revealed late last week by Treasury Registrar Nehemiah Mchechu after a meeting of the plant’s shareholders in Moshi.

According to him, construction of the molasses processing facility will commence early next year and will be located near the sugar processing plant.

The investment, he told the shareholders, is intended to boost the entire sugar value chain, including other byproducts other than the sweetener.

Besides the table sugar and molasses, other byproducts in the value chain include alcoholic spirits and a range of others.

Mr Mchechu said the company’s board had approved the expenditure of Sh112.5 billion to Sh125 billion for the construction of the proposed molasses plant.

The investment, he explained, will boost employment, increase internal revenues for the factory and generate more taxes for the economy.

The molasses to be produced will be used to generate electricity, he added, noting that at least four to seven megawatts will be fitted to the national power grid.

On his part, the Head of Administration at the Moshi-based sugar factory Jaffary Ally said the plant generated a total of Sh99 billion taxes, levies and dividends during 2022/23.

According to him, the factory started to pay dividends from 2010, making TPC Limited the highest in paying dividends in business entities in which the government has minority shares.

Sugar production at the 87-year old has more than quadrupled from 36,000 tonnes in the year 2000 to 116,700 tonnes this year.

TPC Limited is the oldest sugar processing plant in the country, dating back to the 1930s through investors from abroad called A.S. Tanganyika Planting Company, later nationalized.

In the 1970s, it was joined by three plants in Morogoro Region (Kilombero I and Kilombero II and Mtibwa and Kagera Sugar Factory in Kagera region; all owned by the state.

Following the liberalization of the sugar trade in the early 1990s, all the six state-owned estates were privatized.

As per 2019 data, the demand of sugar in Tanzania was 470,000 tonnes a year. Currently the five plants have a capacity to produce 378,000 tonnes.