KEY POINTS
- NSDC says its investment in Oyo Sugar and Derivatives Industries has risen to N2.2 billion.
- The 300 tonnes per day factory in Iseyin has reached commissioning and test running.
- The Oyo State Government contributed about N850 million in equity funding towards outstanding factory works.
MAIN STORY
The National Sugar Development Council (NSDC) says it has invested about N2.2 billion in Oyo Sugar and Derivatives Industries Ltd. (OSDL), Iseyin, as the factory approaches commercial production.
The council disclosed this in a statement on Thursday, saying its financial intervention covered the sugar mill, sugarcane development and operational support.
According to the NSDC, the greenfield factory, designed to process 300 tonnes of sugarcane per day, has reached the commissioning and test running stage under the Nigeria Sugar Master Plan (NSMP).
The council said it initially provided about N1.64 billion for the procurement of the mill before increasing its total financial commitment to approximately N2.2 billion.
The Oyo State Government also contributed about N850 million in equity funding to complete outstanding work at the facility, the council said.
The project started as a cooperative farming initiative involving communities in Iseyin before developing into an integrated sugar manufacturing facility.
The NSDC said the factory was expected to support Federal Government efforts to expand domestic sugar production and reduce reliance on imported sugar.
It described the project as a milestone in implementing the Nigeria Sugar Master Plan and its Backward Integration Programme, which seeks to develop local sugarcane cultivation and processing.
NSDC Executive Secretary and Chief Executive Officer Kamar Bakrin attributed the factory’s progress to cooperation among the council, the state government and the project promoters.
“That this factory now stands ready for commissioning is the result of sustained commitment by the Council, by the Oyo state government and by the promoters themselves,” Bakrin said.
He said the council would continue to support the project as it moved towards full commercial production.
Bakrin added that the facility would demonstrate the potential of developing Nigeria’s sugar industry around locally cultivated sugarcane.
Media reports show that the Nigeria Sugar Master Plan aims to expand local sugarcane cultivation, increase processing capacity and promote an integrated domestic sugar industry.
With commissioning and test running underway, OSDL is expected to move towards commercial production, although the statement did not specify a date for the start of full operations.
THE ISSUES
Nigeria’s reliance on imported sugar makes domestic production capacity an important issue for the food and manufacturing sectors. A factory that processes locally grown sugarcane could support agricultural activity, create a market for farmers and contribute to local industrial production.
However, reaching the commissioning and test running stage does not by itself establish that a factory can sustain commercial output. Its longer term contribution will depend on successful operations, a reliable supply of sugarcane and the ability to maintain production at viable levels.
The reported N2.2 billion NSDC investment and N850 million state contribution represent separate funding commitments. The statement does not provide a full project cost, production forecast or expected annual output, so the total public funding involved and the factory’s projected contribution to national sugar supply cannot be determined from the figures provided.
WHAT’S BEING SAID
“That this factory now stands ready for commissioning is the result of sustained commitment by the Council, by the Oyo state government and by the promoters themselves.”
– Kamar Bakrin, Executive Secretary and Chief Executive Officer, NSDC
WHAT’S NEXT
The factory is at the commissioning and test running stage and is expected to transition to commercial production. The NSDC says it will remain involved during the transition, but no commissioning date or commercial production timetable was provided in the statement.
BOTTOM LINE
The NSDC says its investment in the Iseyin sugar factory has reached N2.2 billion, with additional equity funding from the Oyo State Government. The factory’s contribution to reducing sugar imports will depend on its ability to begin and sustain commercial production using locally grown sugarcane.
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