BI Policy: Dangote Sugar targets 1.5MT annual home-grown sugarcane

*The Management of Dangote Sugar have disclosed the conglomerate posted N441.5billion revenue 2023 full year, explaining how the company is targeting an annual production of 1.5 million metric tonnes of sugar from locally grown sugarcane

Alexander Davis | ConsumerConnect

The Management of Dangote Sugar Plc have disclosed the Backward Integration policy (BIP) of the Federal Government on Sugar will soon have a significant impact on Sugar production in Nigeria soon.

This is as the conglomerate is targeting an annual production of 1.5 million metric tonnes (MT) of sugar from locally grown sugarcane.

Dangote Group, in a statement, said Ravindra Singhvi, Chief Executive Officer (CEO) of Dangote Sugar, disclosed this development when presenting details of the company’s 2023 full-year result to the Nigerian Exchange at the weekend.

Singhvi stated: “In line with the core objective of the National Sugar Master Plan, which is for Nigeria to attain self-sufficiency in sugar production, Dangote Sugar is working on enhancing its existing refinery operations in Numan, Adamawa State, as well as developing its greenfield sites at the Nasarawa Sugar Company Project, among other sites.

“The Company intends to achieve 1.5MT annually from locally grown sugarcane.”

In his comment on the 2023 year-end financial result, the company CEO also said: “Dangote Sugar achieved commendable results despite difficult operating conditions characterised by rising inflation and strained consumer incomes….”

The company further announced a 9 percent increase in its group revenue to N441.5 billion for the year ended December 31, 2023, and a recurring profit after tax, up by 71.5 percent to N97.9 billion.

In regard to outlook for the company, Singhvi stated: “Our focus is to enhance the effectiveness of our supply chain management processes, leading to cost reduction and improved overall efficiency.

“Longer-term, the backward integration project, which aims to produce 1.5MT of refined sugar annually from locally produced sugarcane, is expected to alleviate some pressure on costs and our demand for foreign currency.”

He equally revealed that the proposed merger between Dangote Sugar, NASCON, and Dangote Rice Limited, marks a significant milestone in the company’s journey. “This strategic move reflects our commitment to growth and innovation, positioning us to harness future opportunities in the foods industry.

“We have applied to the Securities and Exchange Commission for the approval of the merger, and we continue to engage the regulators.

“We are confident that this proposed merger will drive sustainable long-term success and yield greater returns to all our stakeholders.”

The CEO maintained that the company’s commitment remains steadfast in ensuring the delivery of high-quality products to valued customers as it continues to work towards fulfilling Nigeria’s Sugar Master Plan.

The conglomerate noted this is with a view to positioning Nigeria as a self-reliant player in the global sugar industry.

Dangote Sugar Refinery Plc is a leading sugar processor in Nigeria engaged in the refining, distributing, and marketing of granulated sugar to major players in the food and beverage, pharmaceutical, and skin care industries as well as distributors.

With a combined installed refining capacity of 1.49 million tonnes per annum between its Apapa and Numan refineries, the company is a significant player in local sugar production, cultivating 75% of the sugar cane used.

Supported by a fleet of over 800 haulage trucks, the company ensures effective product delivery across Nigeria, said the company.

Besides, on completion of the ongoing refinery upgrade in Numan, Dangote Sugar said that the operation is anticipated to generate 32 megawatts of electricity through the installation of new turbines and 2 high-pressure boilers capable of producing 90 tonnes of steam per hour.

Additionally, the company intends to produce ethanol and animal feed from by-products such as molasses and bagasse.