Ouma Wanzala

2 August 2010

Nairobi — Chemelil Sugar Company is set to start co-generation of power in collaboration with KenGen Company in early 2012 as an alternative revenue stream.

Managing director Edward Musebe said the sugar miller is targeting to generate about 26MW of power. It will use some and sell the rest.

He, however, said the company will not start production of ethanol soon though this forms part of its future plans.

Mr Musebe said the move is aimed at enabling them to stay relevant in the market ahead of 2012 when the Comesa safeguards come to and end.

The managing director said they are now paying its more than 5,000 farmers weekly for sugarcane deliveries.

Mr Musebe said the company is currently producing about 200 tonnes of sugar per day though it has a 300 tonnes daily capacity.

He attributed low production to lack of maintenance of the factory machines in the past.

Mr Musebe said that in November this year, the company will be closing down for maintenance which he said will be the second in five years.

"After the maintenance, we expect to start producing about 250 tonnes per day," he said at the ended Kisumu agricultural show.

The MD said that in two months, the firm will be clearing Sh80 million arrears owed to farmers.

He said the company had introduced new seedling variety which matures in 14 months unlike the current type which takes between 18 months and 24 months.

Mr Musebe said that the new variety has high sucrose content and will improve the income of farmers.

The managing director said the company was ready for privatisation.

According to Agriculture minister Sally Kosgei, the government is committed to supporting companies reduce cost of producing sugar.