Tongaat Hulett to get 99-year lease

THE Government has pledged to grant Tongaat Hulett sugar processing company a 99-year lease on the 23 979 hectares of land they occupy.

In a trading update for the third quarter ended 31 December 2020, Tongaat Hulett, which is based in the lowveld, said the Government has affirmed commitment to grant it a 99-year lease on the Hippo Valley Estates.

“The Government has since assured the company that it would be granted security of tenure by way of a 99-year lease on Hippo Valley North (23 979 hectares) whilst maintaining freehold title on Hippo Valley South (16 433 hectares),” said the company.

It said the requisite physical planning and administrative processes were presently underway and nearing completion, paving way for the issuance of the 99-year lease.

The firm has also had its sugar milling licence renewed for another 20-year period ending December 2040.

“These positive actions from Government provide further confidence and stability to the operations.

“Marketing focus remains on ensuring fullfilment of local market requirements while growing export sales in regional premium markets to generate additional foreign currency for the company and the nation,” it said.

Despite the Covid-19 pandemic, the company remains optimistic that the Zimbabwe sugar industry is well positioned to be one of the most competitive in the region.

In 2019, the firm commissioned a 4 000-hectare sugar project with 2 700ha of virgin land having already been cleared and ripped.

The sugar project, which is called “Kilimanjaro” is designed to assist the underprivileged members of society.

Work on the 4 000ha cane development project (Kilimanjaro), which is being undertaken in partnership with Triangle Limited, Government and local banks, has seen 562ha planted in the prior year.

“As previously reported, project works were slowed down on account of delays in obtaining the requisite funding from financial institutions and lack of clarity on land tenure,” said the company.

It said while new funding structures for completion of the project were being finalised, some 76ha and 700 hectares were put to maize and sorghum respectively.

“This is in partnership with Government, as part of efforts to improve food security in the country,” said Tongaat Hulett.

An additional 902 hectares of maize was planted on the company’s fallow cane land as a break crop, resulting in the double benefit of maximising land use, and further improving food security.

In terms of operations, Tongaat Hulett’s overall cane deliveries from its plantations (miller-cum-planter) and private farmers, in the 10 months period to December 31, 2020, trailed the prior year due to the impact of irrigation power challenges as well as the dry spell experienced during the 2019/20 peak growing period of October to March.

During the 10 months period to December 31, 2020, the company harvested 1 043 774 tonnes of cane, which was three percent lower than the comparable period in 2019.

In the same period last year, the sugar producer said private farmers harvested 592 722 tonnes reflecting a 14 percent decrease from the prior comparable period in 2019.

“While the drop in cane from traditional industry sources was compensated for by cane sourced from a third party, production reduced by four percent at the back of lower-than-expected mill efficiencies and incessant rains which interrupted the harvesting programme and impacted cane quality adversely,” it said.

The firm said steps were being taken during the current off crop period to rehabilitate the mill, to ensure improved performance in the 2021/22 production year while solar projects to augment electricity at critical water pumping installations, have been initiated. — chronice.cl.zw