Hibir Sugar SC, Ethiopia has acquired a 6,183 hectare plot of land from the Ministry of Agriculture in the Amhara Regional State. The company will lease the land for 40 years at a rate of 533.30 birr per hectare.
Hibir selected the land for its suitability for irrigation, temperate weather for sugarcane growth, its proximity to the Tana Beles hydro electric power plant and the route to Port Djibouti.
The Ministry of Agriculture allocated the land to Hibir after a close study of its suitability and financial ability to meet 30% equity to fund the project from its own resources said Bizualem Bekele Land Administration team coordinator with MoA.
The project is expected to be completed in three and a half years including the construction of the factory and irrigation system according to Minalachew Simachew, Promotion and Marketing Manager of Hiber.The factory will have the capacity of processing 4,400 tons of sugar cane daily to begin with the potential of reaching 6,600 tons after it is fully completed.
Hibir expects to finance the project with a 70% equity loan from the Development Bank of Ethiopia. The processes to acquire an investment permit took longer than expected affecting the company’s ability to raise funds by selling shares.
Hibir was founded in 2009 with 600,000 birr as working capital and 30 founders, currently the company has 90 million birr in capital and 5,500 shareholders.
Hiber Sugar will launch productions with white sugar but expects to diversify to ethanol production and electric power generation in the future.
Source: Capital
