New komenda sugar factory future bleak

Some few days after the commissioning of the new Komenda Sugar Factory in the Central Region of Ghana, comes opposing and confusing comments from sections of the public which seems politically motivated.

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Prez Mahama Commissions Komenda Sugar Factory
Komenda Sugar Factory
Spining

Whilst, the minority New Patriotic Party (NPP) members of Parliament and the flagbearer of the Progressive People’s Party (PPP), Papa Kwesi Nduom, are expressing fears that the recently commissioned Komenda Sugar Factory may become a white elephant soon.

Prez Mahama Commissions Komenda Sugar Factory
Prez Mahama Commissions Komenda Sugar Factory
According to them, even though the factory has the potential to alleviate poverty through job creation and also cut the country’s sugar exports, government, and its partners failed to consider certain fundamental problems associated with the running of the factory before the commissioning.

They say factors such as the unavailability of sugarcane to feed the factory, unattractive prices for sugarcane produced by farmers and the high cost of irregular electrical power, may soon cripple the factory.

At a press conference in Parliament last week, Ranking Member for Trade and Industry and MP for Wenchi, Professor George Gyan Baffour, said the government’s penchant for political expediency did not allow for critical analysis to be done on the whole project before roll out.

However, some members of the ruling National Democratic Congress have opposed and refuted their assertions of the NPP and PPP casting doubt on the sustainability of the factory.

The NDC says, the opposition parties have just been taken with surprises for the government’s ability to revive the decade’s old collapsed factory.

The NDC had noted that, there are plans put in place to ensure sustainability of the factory. Talking of availability of raw materials; it says, there are schemes that have engaged local farmers in an out-growers schemes to cultivate the sugarcane plantation to feed the factory around the enclaves of the factory down to some areas in the western region. Also, the factory buys from other farmers outside the enclaves as well of the factory such as Nsutam, and its environs in the Eastern region, Ashanti and Brong Ahafo and transported.
Gov’t secures $24.5m for sugar factory President John Dramani Mahama on Monday inaugurated the 24.5 million dollar Komenda Sugar Factory in the Central Region.

During the inauguration of the resuscitated factory, he said the facility, which will create over 7,000 jobs will ensure sustainable development of sugarcane plantations and in turn, harness the continuous growth and smooth running of the facility.

Where’s the sugarcane for Komenda Sugar Factory? But critics have suggested that government’s decision to open the factory without the needed raw material to run it could only mean that it was done for political gain going into elections in November.
Apparent, information gathered indicates that, about 4,000 acres of sugar cane farm lands belonging to the resuscitated Komenda Sugar Factory has been encroached upon by private developers.

The development threatens the cultivation of sugar cane–the raw material needed for the viability of the newly-built Komenda Sugar Factory in the Central Region.

“Thirty years ago, government had 6,300 acres of land but that land has been encroached. It has now become 3000 acres now,” Mr. Nitin Wagh, President of SEFTECH, the project contractor revealed.

Given the limited land available for the cultivation of the crop, the factory will now need 4,000 acres of sugar cane plantation from outgrowers within a 25 kilometer radius of the factory to augment what is produced by the company.

At full throttle, the plant is expected to produce 50 tons of sugar per day. That is about six times the weight of an elephant.

Experts estimate that for a plant that has the capacity to crash 1250 tons per day for 180 days, it requires 225,000 metric tons of sugar cane every other six months for processing.

About 7,000acres of land is needed to grow 225,000 metric tons, given that an acres produces about 30tons of the crop per acre.

The main crashing season is from November-April. From May-October is the maintenance period where they is no sugar cane for processing.

The newly-inaugurated US$36million Komenda Sugar Factory requires 225,000 metric tonnes of sugarcane every other six months to operate at optimal capacity, according the project contractor.

“For a plant with a capacity to crush 1,250 tonnes per day for 180 days (six months), it requires 225,000 metric tonnes of sugarcane. The main crushing season is from November-April. May-October is the maintenance period when there is no sugarcane for processing.

If you crush 1,250 tonnes of sugarcane, there is 10 percent recovery. This also depends on what quality of sugarcane you have. With the best quality, recovery can go as high as 15 or 16 percent of sugar. So if you crush 100 tonnes, you get about 15 or16 tonnes of white sugar,” said Mr. Wagh.

The factory was constructed with a loan facility of US$35million from the government of India-sponsored Exim Bank of India; Line of Credit with an interest of 1.75 percent; and a counterpart funding of US$1.26 million from the government of Ghana (GoG).

The agreement was signed with SEFTECH as the contractor in September 2013. The Letter of Credit (LC) was established in October 2014 with delivery of the project expected in two years; that is, in October 2016. The Loan has an interest of 1.75 percent, with a five-year moratorium. Repayment starts in the sixth year.

Raw materials for the installed processing plant’s trial this week is based on out-growers sugarcane. There isn’t enough raw material now. More work, according to Mr. Wagh, needs to be done to ensure that good quality sugarcane is available for processing.

“The sugarcane farmers within the Komenda enclave don’t have the modern techniques, no irrigation, and no fertiliser programme. What they are doing is that whatever crop comes at the end of the year they harvest it. You cannot do that for many years.

“In India, when you plant the sugarcane, which takes one year to mature, it is harvested for two years and fresh seedlings planted. But here in Ghana, the root is there for 38 or 40 years. That means farmers don’t know about it. So today, the sugarcane in the Komenda area will give you just 4 or 5 percent of sugar. So if you crush 1,250 tonnes, you will get about 50 tonnes,” Mr. Wagh noted.

The Ghana sugar industry was started in the First Republic, and consisted of two factories at Asutsuare and Komenda which began operations in 1967.

The two factories had their own plantations and also bought cane from farmers. Development of the plantations and factories — which were supplied, erected and financed by Poland (Asutsuare) and Czechoslovakia (Komenda) — was badly-planned, executed and managed.

Water for the factory and housing at Komenda was provided by a 24-mile canal from the River Pra; the canal was intended to provide sugar estates with irrigation through a sprinkler system.

The Komenda Sugar Factory later went under private care, but this wasn’t enough to sustain it.
The Ghana sugar industry was started in the First Republic, and consisted of two factories at Asutsuare and Komenda which began operations in 1967.

The two factories had their own plantations and also bought cane from farmers. Development of the plantations and factories — which were supplied, erected and financed by Poland (Asutsuare) and Czechoslovakia (Komenda) — was badly-planned, executed and managed.

Water for the factory and housing at Komenda was provided by a 24-mile canal from the River Pra; the canal was intended to provide sugar estates with irrigation through a sprinkler system.

The Komenda Sugar Factory later went under private care, but this wasn’t enough to sustain it.

The new processing facility was constructed with a loan facility of US$35million from the government of India-sponsored Exim Bank of India; Line of Credit with an interest of 1.75 percent and a counterpart funding of US$1.26million from the government of Ghana (GoG).

The agreement was signed with SEFTECH as the contractor in September 2013. The Letter of Credit (LC) was established in October 2014 with delivery of the project expected in two years; that is, in October 2016.

The Loan has an interest of 1.75 percent, with a five-year moratorium. Repayment starts in the sixth year.

Source: Adnan Adams Mohammed

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