Khartoum – Kenana Sugar Company is the head of the spear of the Sudanese project for agricultural development. While governments and Arab companies discuss strategies for the sector, the organisation plans to invest US$ 2 billion over the next five years in several expansion projects.
"The [Sudanese agricultural development] strategy is substantial, we must embark on broad-scale projects turned to export,” said the managing director at the company, Mohamed El Mardi El Tergani, in an interview to ANBA in Khartoum, the capital of the African country. "The largest and easiest sector in Sudan is sugar,” he added.
It is the largest and easiest as over the last 37 years, since it was established, the company has been developing a project that, in thesis, may be applied to other areas. The company shareholders are the governments of Sudan, Saudi Arabia and Kuwait, Arab fostering institutions, commercial banks and the Japanese Sojitz, and it uses an integrated production system where by-products, like molasses and bagasse, are used in production of ethanol, animal feed and energy.
Through its subsidiaries, Kenana also produces dairy, peanuts, sunflower seeds, maize and soy. The idea is to increase production and expand into other products, like sorghum, wheat, meats, vegetable products, vegetable oils and biodiesel.
“Foods and fuels are the global concern,” said Mardi. “There is lack of food [on the global market]; there is a crisis and no availability. Even those with money will not be able to buy,” he added.
Still this year, the company hopes for the start of production in a new plant, White Nile, in which it has a share, and which should produce 500,000 tonnes of sugar per year, a volume that is equal to that produced by the company today. Another project forecasted, Redais, which has Chinese shareholders, aims to expand the total in another 500,000 tonnes.
In ethanol, Kenana, which already produces the fuel in a factory with machinery and equipment supplied by the Brazilian Dedini, aims to expand its capacity, which is currently 65 million litres. Sudan sells the fuel to the European Union.
In Sudan, one of the main problems is financing. According to Mardi, lower-sized projects may even manage to get capital on the local market, but for larger projects, the solution is seeking capital at institutions in other countries, like the Arabs of the Gulf and China. There is great Chinese presence in Khartoum.
Brazilian partnership
For the expansion projects, Kenana should cover US$ 500 million and aims to finance the rest on the international market, including with export credit from Brazil.
“We want to be part of the Brazilian export [financing] project,” said the executive. This way, the company hopes to manage to buy Brazilian machinery, equipment and even seeds. This trade is already present, as there are also Brazilians operating in agriculture in Sudan, despite the small scale.
Still regarding Brazil, Kenana, according to Mardi, is in talks with Odebrecht group discussing the construction of a sea terminal in Port Sudan, on the Red Sea, and also the production of soy biodiesel.
On another front, Kenana has launched, in partnership with the Egyptian Beltone, an agricultural sector investment fund, Mahaseel, aimed at collecting US$ 1 billion for projects in Sudan and Egypt. “It is a share fund, a new mechanism to finance projects,” said Mardi. One of the main sources of capital targeted is sovereign funds.
But Sudan does not aim to live only off agriculture. The country is rich in mineral resources, despite most of the oil production having remained in South Sudan after the country was separated into two nations in the middle of the year.
According to the president of the Sudanese Businessmen Association, Saud Al Breir, the country hopes, in the near future, to expand its gold exports from 30 tonnes a year to 74 tonnes a year. He added that in North Sudan there are oil reserves that have not yet been tapped.
Other items that may be better used, in his evaluation, are gum Arabic, traditional in Sudan, and hibiscus, or karkadé, a flower from which tea that is greatly appreciated in the region, especially in Egypt, is produced. The Egyptians believe it is good treatment for several kinds of diseases.
“Sudan is not Eldorado, but is a country that is rich in mineral resources, has abundant water and is in a strategic location,” said the Brazilian ambassador to Khartoum, Antonio Carlos do Nascimento Pedro.
*Translated by Mark Ament