Hippo Valley says the delays in securing a 99-year lease for the 23 979 hectares of land earmarked for the development of its Kilimanjaro Project has stalled progress as financiers await further clarity.
The company earlier said Government had made assurances that administrative processes were nearing completion to pave way for the issuance of the 99-year lease.
“Expansion works on the 4 000 hectares cane development project (Project Kilimanjaro) remain suspended due to delays in concluding funding arrangements with financial institutions pending further clarity on land tenure,’ the company said in its six months to September trading update.
According to the country’s laws, the state owns all land hence entities and individuals can only be issued 99-year leases.
The Kilimanjaro project is a partnership between the company, government and some local banks set to increase sugarcane production.
To date, 2 700 hectares of virgin land has been cleared.
“Notwithstanding, Tongaat Hulett Zimbabwe is now mobilizing funding to complete part of the already cleared 2 700 hectares in the current financial year with priority being given to that portion of the land to be developed for the benefit of local communities,”
“The 562 hectares planted to sugarcane in prior years is achieving the targeted yields and generating revenue adequate to meet working capital and loan obligations as they fall due,” said the company.
Meanwhile, Cane deliveries from the Company’s plantations (miller-cum-planter) were 12 percent below the same period in prior year due to a combination of a 5 percent reduction in area harvested to date and a 7 percent drop in cane yields to date, occasioned by insistent cloud cover during the past rainfall season, which constrained cane growth during this period.
Cane deliveries from private farmers were however 42 percent above the same period in prior year due to increased area harvested to date, benefiting from prior year carryover cane and an earlier start to the harvesting season which began on 20 April (2020: 5 May).
Consequently, sugar production for the half year under review increased from the same period in prior year with a satisfactory factory performance, following a successful off crop maintenance program.
