Companies

Power outages hit Chegutu Canners

TINASHE MAKICHI

Chegutu Canners is losing millions of dollars in potential revenue due to crippling power cuts, a company executive has said.

The Chegutu based firm, which resumed operations in 2017 after receiving fresh cash injection from parent company Olivine Industries, has been operating full throttle ever since.

But, the company, which manufactures products like Green Valley, Holbrooks and Cartwrights products that include baked beans, canned fruits, curries, mustard, vinegar, sauces, marmalade and jam among others, has been severely hit by power cuts which have affected business activities at the Chegutu plant, with production being severely curtailed.

The company no longer operates 24 hours a day due to severe power cuts.

Silvester Mangani, CEO of Surface Wilmar, which controls a 65% stake Olivine Industries, confirmed that severe power cuts have hit Chegutu operations. Government holds the remaining 35% stake in Olivine.

“Power cuts have been the biggest challenge for the Chegutu operation considering that this is a 24 hour operation that does not need any disturbances while in production,” Mangani said.

“This factory is currently running mostly 30% of the time because the outages can stretch for long hours.”

He said the company has engaged ZESA over the matter. Before the intervention by the parent company about four years ago, Chegutu Canners had been battling to offset mounting debts, which were estimated to be about US$20m.

The company was once a key exporter across the SADC region.

The US$15m investment by Surface Wilmar injected into Zimbabwe in 2015 revived Olivine Industries, which had virtually collapsed, bringing  back household brands that had disappeared from store shelves; Jade, Perfection soap and Olivine baked beans. Two years later, Chegutu Canners, was revived as well.

Surface Wilmar had plans to invest a further US$73m into Zimbabwe units.

But its shareholders have had to abandon those plans due to deepening forex shortages.

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