The Sunday Mail
Livingstone Marufu
FAST moving consumer goods manufacturer Olivine Industries has splashed US$15 million on margarine processing technology and a soap plant.
This is expected to improve availability of Buttercup margarine and several soap brands. While equipment for the soap plant is still coming into the country, refurbishment of the margarine plant will be complete by month-end and Buttercup will return to supermarket shelves after a two-year absence.
The new margarine plant will boost production efficiencies and Olivine aims to ramp up production capacity to about 80 percent from the current 20 percent.
Margarine production at Olivine was being hampered by old equipment, some of it dating back to 1947, which saw the firm losing a considerable market share to other brands.
Olivine board chair Mr Peter Madara told The Sunday Mail Business that the state-of-the-art plant would see the company competing at the highest level.
“Olivine is implementing the margarine processing technology project and the soap plant project at a cost of US$15 million.
“Olivine is investing in margarine processing technology in three phases over a period of three years. Phase 1 has seen the upgrading of the margarine plant to meet world class safety and hygiene standards. As commissioning should be completed during this month, this plant upgrade will see the market receiving local supplies of Buttercup margarine before end of this month,” said Mr Madara.
Like other local manufacturers, Olivine is battling the obtaining liquidity crunch which has adversely affected importation of raw materials. The Reserve Bank of Zimbabwe is putting in place measures to address the liquidity challenges, in particular ending delays in processing telegraphic transfers.
Industry has implored Government to clear the bottleneck before the situation further deteriorates. Some supermarkets, especially in Bulawayo, are already rationing products such as cooking oil to ensure everyone accesses it as production lines have been throttled.
Meanwhile, Mr Madara said the first consignment of the soap making equipment recently arrived in Beira, Mozambique, en route to Harare.
More making equipment is expected through to November.
Once the equipment has been fixed, soap production is expected to begin in earnest by year end.
Olivine secured US$32,2 million from Singapore-headquartered agribusiness group Wilmar International, some of which has been used to refurbish the margarine plant.
Some of the money will go to addressing Olivine Industries’ debt arrears estimated at US$34 million against current assets of about US$17 million, of which US$17,2 million is inventory.
Apart from margarine and cooking oil, the company also produces bakers’ fats, candles, soya meal and cotton seed meal.
Its other established brands are Perfection and Dolphin laundry soaps.
Olivine’s subsidiary, Chegutu Canners (Private) Limited, manufactures canned beans, tomato and fruit products.
