Counties

Nzoia Sugar receives Sh216 million for annual maintenance

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Workers at Nzoia Sugar Company in Bungoma County. FILE PHOTO | NMG

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Summary

  • The company plans to shut down operations in the next one week for the annual repairs.
  • The company has been making losses in the past six years due to ageing machinery among other factors.

Nzoia Sugar Company has received Sh216 million from the government for routine machine maintenance to increase milling capacity and cut down on operational costs.

The company plans to shut down operations in the next one week for the annual repairs.

“We had requested Sh335 million but allocated Sh216 million for normal maintenance of machines and other equipment,” said Chrispine Ogutu, the Nzoia managing director.

Spare parts

He disclosed that Sh150 million will be spent on spare parts while the rest of the money will be used to pay experts.

Mr Ogutu said the company has been making losses in the past six years due to ageing machinery among other factors.

“Our crashing level has been too low translating to heavy losses. We mill 17 tonnes of cane to produce one tonne of sugar instead of 10 tonnes of cane to produce a tonne of sugar,” said Mr Ogutu.

He attributed the losses to low crashing capacity, noting that he took over when production cost was Sh8,500 per 50 kilogrammes of sugar while similar quantity retailed at Sh5,300.

“The company will close down from 13th May to allow engineers to repair the machines in order to attain optimum operations” Mr Ogutu said.

Mr Ogutu also disclosed that the factory owes cane farmers about Sh789 million.

He said that from 2020 to last month, a total of Sh1.5 billion has been paid to farmers.

"We have paid farmers over Sh500 million in addition to Sh284 million received from the government last December," he said.

The company, he said, can employ 980 permanent employees but now has 801.

Last December Agriculture Cabinet Secretary Peter Munya and his Defense counterpart Eugene Wamalwa visited the factory and promised the farmers that they would institute a board to facilitate smooth operations but nothing has happened to date.

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