SABMiller plans Sudan expansion

The plant in Juba would nearly double its capacity to 350000 hectolitres by the end of the year, compared with 180000 hectolitres when it opened in May last year, the company said on Friday, 20 August 2010. The plant, in Sudan's Christian south, will add the brands Nile Special Lager and Club Pilsner to its existing local beers White Bull lager and Chairman's Extra Strong Beer.

Capacity for sparkling soft drinks will rise to 320000 hectolitres from 60000 hectolitres.

Prior to the Juba plant's completion, SABMiller was importing beer from neighbouring Uganda. Southern Sudan is one market brewers such as SABMiller see as having potential for growth.

The plant was one of four new breweries the company built in Africa last year, along with those in Angola, Mozambique and Tanzania. Africa's average annual per capita beer consumption is about 6l and the company says that this could grow to 12l-15l In SA, the figure is 55l.

Initial challenges

The US$3-million expansion, so soon after completion of the $38m brewery is a welcome surprise for the brewery, which faced multiple challenges in its construction and start of operations.

"We think our contract for the land goes as far as a cow slaughtered on the ground," SABMiller Africa MD Mark Bowman said in May.

The company imported second-hand brewing plants from Belgium, Malta and Russia. While shipping the equipment to Sudan, SABMiller lost a 25m-long brewing tank overboard, he said.

After opening its doors, demand from local traders was surprisingly muted.

"We somehow assumed the market would welcome us," Bowman said.

Resolution

"To get local traders on board they had to halve the price," he said. Still, the expansion indicates the teething difficulties are resolved.

"We have sold more beer in the first three months of our second year of operation than we did in the first nine months since production began," said Ian Alsworth-Elvey, MD of SABMiller unit Southern Sudan Beverages.

Source: Business Day