TPC Limited, the country's oldest sugar plant, has announced plans to invest TZS 112.5 billion in the construction of a state-of-the-art molasses plant. This significant investment follows TPC's remarkable financial performance in the fiscal year 2022/23, where it reported an after-tax profit of TZS 72.7 billion, driven by record-breaking sweetener sales worth TZS 235 billion.
Molasses is a valuable byproduct of the sugar-making process, derived from crushed sugarcane. It is a thick syrup remaining after the extraction of sugar crystals from the sugarcane juice. The news of this investment project was disclosed by Treasury Registrar Nehemiah Mchechu after a recent meeting of TPC Limited's shareholders in Moshi. Mchechu shared that construction of the molasses processing facility is scheduled to commence early next year and will be situated near the existing sugar processing plant.
This substantial investment aims to enhance the entire sugar value chain, not limited to just sweetener production. The sugar value chain includes the production of table sugar, molasses, alcoholic spirits, and various other byproducts. Mchechu informed shareholders that TPC Limited's board had approved an expenditure range of TZS 112.5 billion to TZS 125 billion for the construction of the proposed molasses plant. He emphasized that this investment would contribute to increased employment opportunities, higher internal revenues for the factory, and greater tax revenues for the economy.
Furthermore, the produced molasses will serve a dual purpose as it will be used to generate electricity. It is estimated that at least four to seven megawatts of electricity will be supplied to the national power grid. Jaffary Ally, the Head of Administration at the Moshi-based sugar factory, highlighted the substantial contribution made by TPC Limited to the national economy. He reported that the factory had contributed a total of TZS 99 billion in taxes, levies, and dividends during the 2022/23 fiscal year.
Ally noted that TPC Limited had been paying dividends since 2010, establishing it as the leading contributor to dividend payments among government-held minority shares entities. Over the years, sugar production at the 87-year-old TPC Limited has seen substantial growth, increasing from 36,000 tonnes in 2000 to an impressive 116,700 tonnes this year.
TPC Limited has a rich history, dating back to the 1930s when it was founded by foreign investors under the name A.S. Tanganyika Planting Company before being nationalized. In the 1970s, it was joined by three other sugar plants in the Morogoro Region (Kilombero I, Kilombero II, and Mtibwa) and the Kagera Sugar Factory in the Kagera Region, all owned by the state.
However, following the liberalization of the sugar trade in the early 1990s, all six state-owned estates were privatized. As of 2019, Tanzania's sugar demand stood at 470,000 tonnes annually, while the five plants had a combined production capacity of 378,000 tonnes.