Paul Gbedebo, Group Managing Director, Flour Mills of Nigeria Plc, speaks on the company’s Suntai Golden Sugar Estates , how it is helping the country actualize its sugar production goal.
What informed the Sunti Sugar Estate Project?
For starters, it is essential to note that FMN still has one of the biggest product offerings of any Nigerian company operating in the FMCG sector. Since independence, our flagship food brand, “Golden Penny,” has remained the family favourite, and has earned a prominent position for itself in the kitchen of just about every household in the country.
To ensure that we continue to meet the expectations of our consumers, especially in terms of delivering on quality, we embarked on an ambitious backward integration strategy since the early seventies with a deliberate focus on five key food areas that are essential for nourishing our consumers. Accordingly, our businesses now cover five value chains of grains, oils & fats, proteins and feeds, starches and of course, sugar.
“The floods affected as much as 750ha of sugarcane which was submerged by the floods”
Naturally, we had continued to focus our investments in developing and improving our production competencies in these value chains. Sunti Golden Sugar Estates is essentially the upstream segment of our operation in the sugar value chain. Don’t forget that we also operate in the downstream sector as well.
FMN owns and runs one of the largest sugar refineries in Nigeria, here in Apapa, with the capacity to process 750,000 metric tons of sugar per annum.
Sunti Sugar Estates is in line with the Federal Government’s backward integration policy, the National Sugar Master Plan and in compliance with the mandatory requirements for sugar processors in Nigeria. But for us, Sunti
has always been more of a strategic approach that is intended to secure our supply chain and ensure the sustainability and future growth of our business.
What is the significance of Sunti Golden Sugar Estates in FMN’s backward integration agenda?
As one of the biggest food and agro-allied companies in Nigeria today, we understand that millions of Nigerian families depend on us for their daily food and nutrition needs. As such, our entire backward integration strategy
has been designed around the need to secure a sustainable supply chain that guarantees access to quality raw materials for our production process.
In addition to improving synergy within the Group, the Sunti Sugar Estate, like most of our businesses within the agro-allied sector, offers numerous import substitution opportunities to help conserve forex and further create jobs for our teeming youth while tackling food security in the country.
What is the scale of this project in terms of cost and infrastructure acquired?
The Sugar Estate is in Mokwa, Niger state. It comprises of 17,000 hectares of arable farmland and a sugar mill with the capacity to process 4,500 metric tonnes of sugarcane daily.
At full capacity, the estate can easily produce one million tonnes of sugarcane and 100,000 mt of sugar annually.
The estate is enclosed within a 35-kilometre dyke, which is designed to provide flood protection from River Niger. The estate features a state-of-the-art irrigation system that will ensure efficient cultivation of sugarcane, with infrastructure that includes drain pumps, pump stations, and a power grid.
We believe that Sunti estate is one of the purest representations of the Federal Government’s Nigerian Sugar Master Plan (NSMP) in action. In addition to its capacity of reducing the need to import Sugar, which will save billions in foreign exchange for the country, the estate has also significantly boosted local capacity, and have created several jobs including direct employment for about 10,000 people and indirect employment for about 50,000
people yearly. In terms of investments to date, we have invested well over N60 billion on the project.
What have been the challenges encountered in the Sunti Golden Sugar Estate BIP?
The most significant challenge is the recurring flooding of the Estate since the inception of the project. In September 2018, for example, we recorded two significant breaches, each in excess of 30m at our dykes because of flows from local catchments and the unprecedented rise in the water levels at Niger river. The floods affected as much as 750ha of sugarcane which was submerged by the floods. Sadly, most of the flood cases could have been averted with proper management of the water flow from the upstream river and dam network at the Kainji and Jebba Hydroelectric dams. Lately, we have received a lot more cooperation from the dam authorities and have been in constructive talks with the government on the best approach around these challenges and are very hopeful that we would soon reach a workable solution that will benefit all the parties.
Culled from BusinesDay