starafrica still to commission upgraded plant
It said significant progress has been made on the plant upgrade project at Goldstar Sugar Harare and the company was looking for funds to complete integration of the plant.
“Sixty percent of the plant has been upgraded using equipment sourced from India and the 60 percent has also been assessed for functionality by sugar technology consultants from South Africa and found to meet the requirements contracted for with the supplier,” said starafrica.
starafrica said pending commissioning of the integrated plant, the factory can be operated viably at 300 tonnes per day, enough to meet demand from retail and industrial consumers.
In six months to September 2015, Goldstar produced just over 5 000 tonnes of refined sugar compared with 376 tonnes produced in 2014. Sales were negatively impacted by low production volumes as the plant operated for only three months due to low off take.
However, the local sugar market has stabilised following the introduction of duty on imports.
“A nationwide distribution arrangement has been put in place with a major wholesaler for Goldstar refined sugar for direct consumption with view of boosting volumes,” it said.
The accreditation of Goldstar by the Coca- Cola Company in April this year will also result in increased sales volumes.
Despite the progress achieved on addressing capacity issues at Goldstar, the company will not be able to trade out of its negative equity position or settle its liabilities as they fall if strategies being pursued to extinguish the debt are not successful.
These include the disposal of starafrica’s 33 percent stake in Tongaat Hullet Botswana and Bluestar Logistics. The disposals are part of the Scheme of Arrangement entered into with creditors and lenders in August 2013.
Starafrica said the disposal on THB has been slow “due to onerous requirements from other shareholders.”