Bakrin: $7.1bn Sugar Plan to Save $2.1bn in FX Annually

• NSDC unveils 10 greenfield estates, targets 835,000 tonnes of additional output, projects110,000 Jobs, others

James Emejo in Abuja

Executive Secretary/Chief Executive, National Sugar Development Council (NSDC), Kamar Bakrin, has revealed that the revised $7.1 billion, 10-year sugar development programme will bridge the country’s domestic production gap, cut annual Foreign Exchange (FX) expenditure by about $2.1 billion and create 110,000 jobs.

He noted that as the country intensifies efforts to reduce dependence on imported sugar, 10 proposed greenfield estates, expected to produce 835,000 metric tonnes of sugar annually at full capacity, remained central to the ambitious plan to lift national output beyond two million tonnes.

Bakrin spoke while briefing journalists in Abuja over the weekend, adding that the council was moving from policy commitments towards measurable implementation, with estate performance to be monitored through physical inspections and satellite technology.

The initiative targets a market with annual domestic demand of 1.8 million tonnes, underscoring the scale of investment and production needed to achieve self-sufficiency, cut sugar imports, conserve foreign exchange and create jobs.

The NSDC boss further outlined a three-pronged strategy built around improving existing estates, expanding established operators and attracting new investors into greenfield projects.

The programme’s success, however, will depend on translating investment commitments into functioning factories, reliable cane supplies and commercially viable operations, he added.

Greenfield projects advance towards implementation

Bakrin said the pipeline of 10 greenfield projects had progressed beyond the conceptual stage, with promoters identified for all the proposed estates and 143,478 hectares of land secured.

The projects envisage combined milling capacity of 55,500 tonnes of cane daily, while independent technical reviews are underway to ensure they meet bankability requirements.

The council expects the 10 estates to contribute 835,000 tonnes of sugar annually when fully operational, complementing production from existing estates and expansion by incumbent operators.

According to him, credible Nigerian business groups outside the sugar industry had expressed interest in investing, alongside international companies, including some already operating in the country.

According to him, some prospective investors had acquired land and commenced feasibility studies, with the council hopeful that groundbreaking on some projects could begin before the end of the year.

He said the projects were distributed across eight states, while as many as 14 states had climatic conditions potentially suitable for commercial sugarcane cultivation.

Adequate water supply and sufficient rain-free days are critical to commercial production, particularly for the development of sucrose in sugarcane.

Meanwhile, the 10-year programme requires $7.1 billion in investment, comprising $5 billion in debt financing and $2.1 billion in equity.

The proposed debt structure includes approximately $3 billion from export credit agencies, $1.75 billion from development finance institutions and $250 million from local development finance institutions.

Existing operators to deliver bulk of production

Beyond the greenfield pipeline, the programme seeks to optimise existing estates to produce approximately 100,000 tonnes annually, while incumbent operators are expected to contribute 1.22 million tonnes.

Together, the three interventions are projected to generate more than two million tonnes of sugar annually across 13 projects, exceeding current domestic demand.

The projections place the expansion of existing businesses alongside new investment as critical to achieving the production target, rather than relying exclusively on greenfield development.

Ethanol, power to strengthen investment case

The NSDC is also positioning future sugar estates as integrated bioenergy platforms capable of producing sugar, ethanol and electricity.

Bakrin said the additional revenue streams were important to the commercial viability of the projects, particularly ethanol, which he described as a significant component of their bankability.

He noted that Nigeria had maintained an E10 blending mandate since 2007, requiring ethanol to account for about 10 per cent of fuel consumed under the policy.

Successful implementation of the investment programme, he said, could provide sufficient domestic ethanol to meet that target.

The estates are also expected to generate electricity for sale or injection into the national grid, expanding their contribution beyond food production and reducing dependence on a single revenue stream.

Outgrowers to supply existing mills

To address constraints in sugarcane supply, the council is targeting 11,000 hectares under farmer-grown sugarcane around existing mills.

So far, 7,000 hectares, representing about 64 per cent of the target, have been identified with partners in Kwara, Niger and Adamawa states.

The initiative is expected to supply 880,000 tonnes of sugarcane to existing mills and generate approximately 88,000 tonnes of sugar annually.

The programme is also intended to strengthen the participation of local farmers in the value chain, while improving access to raw materials for established processors.

To address shortages of technical expertise and quality planting materials, the NSDC has strengthened the Nigeria Sugar Institute to provide training, extension services, planting materials, project evaluation and estate support.

The council projects that successful implementation will generate 110,000 direct and indirect jobs, affect over one million livelihoods across the value chain and increase the gross domestic product of host communities by more than 100 per cent over 10 years.

It also estimates that domestic sugar and ethanol production could reduce annual emissions by about two million tonnes of carbon dioxide equivalent.