Chemplex splurges US$36m in units

…Seeks to boost fertiliser production

September 23, 2021

 

TINASHE MAKICHI

 

Zimbabwe’s largest fertiliser and chemical manufacturing firm, Chemplex Corporation, is spending about US$36m upgrading the Zimbabwe Phosphates (Zimphos) and Dorowa Mines as it moves boost local fertiliser production, Business Times can report.

Chemplex, a unit of the Industrial Development Corporation of Zimbabwe (IDCZ), will install new equipment and machinery at its two units—the Buhera-based Dorowa Mines and Harare-based Zimphos, which is the country’s sole producer of phosphate fertilisers, aluminium sulphate for water treatment and sulphuric acid.

The latest development, which was confirmed by IDCZ chairman, Winston Makamure, comes after the government adopted a five-year fertiliser import substitution programme.

The programme is expected to propel phosphates production to 100 000 tonnes from the current 80 000 tonnes. It is also expected that imports will be reduced to 140 000 tonnes from 180 000 tonnes.

“Zimphos has started the upgrades which will be in stages or in a modular fashion. There was no inordinate delay except normal lead times for ordering and receiving the upgraded equipment which is imported.

“The upgrade also had to be sequenced with the upgrade at Dorowa Minerals since the production at Dorowa Minerals is fed to Zimphos for processing and further value addition,” Makamure told Business Times.

He said there were also efforts to restore a sulphuric acid plant at Zimphos which has not been operating at full capacity.

This is aimed at improving the production of fertiliser and water chemicals. The plant is expected to be complete by the year 2021.

Makamure said there were also other long-term projects in the pipeline that would require a huge investment and feasibility studies.

The latest project being mooted by Chemplex is the construction of a Phosphoric Acid plant at Zimphos.

The latest plans to revitalise fertiliser manufacturing comes after the Reserve Bank of Zimbabwe (RBZ) in 2017 availed US$5m to Zimphos aimed at recapitalising the company.

The investment added up to US$10m including the US$5m already injected by the RBZ on Dorowa Minerals.

The planned investments in Zimbabwe’s fertiliser industry will trigger a significant reduction in the cost of the products and make them more competitive on both the local and the export markets.

Zimbabwe’s fertiliser products are currently the most expensive in the region, partly due to high costs leading to massive production inefficiencies.

Zimbabwe’s demand for fertiliser in a normal and good farming season is about 600 000 tonnes, both basal and top dressing, of which 70% goes towards government farming programmes.

The upgrade at the two plants comes after the government has intensified efforts to revive all fertiliser manufacturing companies in order to cut the fertiliser import bill that has for years stretched into billions of dollars.

Under the five-year fertiliser import substitution programme that the Government has adopted, nearly US$80m would be invested to enhance the capacity of local firms with prices expected to gradually decline by an average of 28% over the next four years.

Ammonium nitrate, according to the roadmap crafted by the Ministry of Industry and Commerce, will gradually drop to US$18 for a 50kg bag from the current US$25 while the price of phosphates will decline to US$9.25 from US$13.

The roadmap will be largely anchored on ramping up production at Sable Chemicals, the country’s sole ammonium nitrate producer and Chemplex Phosphates production units.

An investment of nearly US$40m would see Sable Chemicals increasing output to 240 000 tonnes of ammonium nitrate by 2024. This would, in turn, reduce imports from the current 220 000 to 10 000 tonnes.

Apart from ZimPhos and Dorowa Mine, Chemplex also owns Chemplex Marketing, Chemplex Animal and Public Health, GD Haulage, and G and W Industrial Minerals.

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