April 25th 2017

Business / Markets

Trans Mara Sugar looking to increase production through equipment leasing system

The Sh50 million lease agreement between Trans Mara Sugar Company and Quipbank Trust Limited and Tata Africa Holdings Limited was planned to reduce on post-harvest losses occasioned by delay in delivery of cane to factories.

By Free Press Correspondentnewsdesk@kenyafreepress.comWednesday, 31 Aug 2016 09:53 EAT

At a time when sugar millers are beset by challenges of underproduction, the Trans Mara Sugar Company in Narok County is gearing to produce its largest stock of the commodity this year after acquiring top of the range machinery.

The company recently leased cane haulage and loading equipment from Vehicle and Equipment Leasing Limited (VAELL) worth Sh34 Million. The equipment included excavators comprising a bucket and grabber and sugar cane loaders containing four cylinders to aid it in its daily operations in a bid to reduce delay of cane harvesting and processing.

VAELL Regional Director Paul Njeru said that they leased 12 tractors to the company in April which together with the new equipment will ensure the delay of cane harvesting is addressed once and for all to ensure that farmers get maximum profits.

In April, the company received 11 tractors from John Deere under the Tinga Lease Solution program.

The Sh50 million lease agreement between Trans Mara Sugar Company and Quipbank Trust Limited and Tata Africa Holdings Limited was planned to reduce on post-harvest losses occasioned by delay in delivery of cane to factories.

“We have spent close to Sh80 Million to supply Trans Mara Sugar Company with the tractors and equipment in order to ensure that they are able to serve the farmers in a satisfactory manner for their mutual benefit,’’ said Njeru.

The Regional Director said that they are addressing the lack of adequate equipment and machinery in many African sugar millers by leasing equipment in seven countries in East and Central Africa.

"This is a reflection of a strategy that focuses on growing the sugar industry to meet the skyrocketing market demands, it is a significant step towards achieving Trans Mara Sugar Company's objective of becoming an emerging market player in the region," said Njeru.

He said that leasing is preferred by leading multinationals because it frees company’s cash flows by doing away with the need to spend more money in buying the required equipment yet they can obtain mass equipment through leasing accelerating the production process.

"The cost of farming equipment is high with many farmers and companies not being in a position to purchase the machinery in cash, that is why we developed the Tinga Lease Solution to make farming in Kenya affordable," said Njeru. 

Trans Mara Sugar Chief Operating Officer Rajesh Bhargava said that while it was their priority to improve their operations they have a big challenge of loading and hauling the cane from the farm as well as the cane yard.

"These machines will help us load the cane in the farm and the cane yard. We are committed to support initiatives that positively impact local communities by empowering them through sustainable practices,” said Bhargava.

He said that they had opted for leasing as their new business model to increase their tractor fleet expanding their business to greater heights which and that the new initiative will enable them reduce their operation cost by 30%.

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