Tanganda Tea Company Completes 4,4 Mega Watts (MW) Solar System!

Tanganda Tea Company has invested in three solar power plants with capacity to generate a combined 4,4 megawatts (MW) to reduce reliance on the national grid and costly diesel-powered generators.

The company, which is Zimbabwe’s largest producer, packer and distributor of tea, relisted on the Zimbabwe Stock Exchange (ZSE) in February this year after a 14-year absence from the local bourse.

The relisting follows the company’s unbundling from Meikles Limited.

Tanganda has transformed itself over the years from a tea business to a diversified agricultural export business, making it an attractive investment. Presently, the firm has five estates- New Year’s Gift, Ratelshoek, Jersey, Zona, and Tingamira (formerly Avontuur/Petrunella).

The tea producing company intends to sell excess energy to State power utility Zesa to feed into the national grid. The investment by Tanganda comes as Zimbabwe is presently experiencing acute power shortages due to constrained domestic production capacity, which has spawned long hours of load shedding across the country.

The power deficit is being caused by limited production at Hwange Thermal Power Station, the country’s second-largest power plant, which can not produce at optimal levels due to aging equipment and frequent breakdowns.

The situation has been exacerbated by water shortages in Kariba Dam, Zimbabwe’s biggest power station, which has forced the power station to drastically curtail generation to avoid depleting the giant lake.

The Zambezi River Authority, which administers the Kariba Dam, has directed the Zimbabwe Power Company to curtail the production of electricity at Kariba South until the water level in the dam improves, at least by January next year.

The Government has since indicated it would import power from the region, optimise generation from Hwange and speed up the process to bring online Hwange units 7 and 8, which is undergoing final phases of commissioning to add 600 megawatts (MW) to the national grid.

As of yesterday, ZPC was producing 566MW made up of 220MW from the Kariba South hydropower plant while 346MW came from Hwange Power Station, which has an installed capacity of 920MW.

As a stop-gap measure, the Government has also negotiated for about 500MW with Zambia and Mozambique and the power imports are expected any time soon.

The Government has also pledged to leave no stone unturned in facilitating expedited investments by Independent Power Producers, including putting in place a viable tariff, which would assist the development of 7000MW worth of planned projects.

“To this end three solar plants constructed at three of the five estates have reduced reliance on electrical power from the national grid and on diesel generated power thereby reducing carbon emissions.

“Further benefits from the investment are expected to be fully realised once full reticulation and net metering have been implemented in the coming financial year.

“Modern precision irrigation installed in the avocado and macadamia plantations ensures efficient usage and conservation of water,” said the company in a statement accompanying financial results for the year ended September 30,2022.

Tanganda Tea Company Completes 4,4 Mega Watts (MW) Solar System!

Tanganda has invested in four key value chains namely: tea, macadamia nuts, avocados and coffee. The firm believes that diversifying operations has yielded tangible benefits and will continue to be a focus in the coming years.

In the period under review, Tanganda revenue grew by 7,7 percent to $12,22 billion compared to $11,35 billion in the prior year.

In historical cost terms, a 194 percent growth from $2,5 billion to $7,35 billion was achieved.

Profit after tax improved to $583 million from a loss of $318 million in the previous year.

“In historical cost terms, it increased from a profit of $668 million to a profit of $4,2 billion,” said the company.

During the financial year under review, the company’s bulk tea exports grew by 11 percent to 7 125 tonnes from the prior season’s 6 392 tonnes.

This was despite tea production volumes of 8 670 tonnes being six percent lower than prior year’s 9 179 tonnes due to the dry weather patches experienced during the agricultural season.

The average export selling price firmed up slightly to US$1,42 per kilogramme from US$1,39 per kg in the previous year.

On the avocado business, Tanganda said its exports grew by seven percent from 4 001 tonnes in the prior season to 4 268 tonnes.

“However, the average export selling price of US$0,44 per kg was 38 percent lower than US$0,71 per kg in the prior year as a result of the oversupply on the European market by Peru, compounded by the Covid-19 pandemic that reduced volume uptake by the European hospitality sector.

“As the world moves out of the pandemic, we expect that both export volumes and selling prices will firm up and 49 additional hectares (prior year – 43 ha) of avocado plantations were established during the financial year bringing the total hectares under avocado to 497ha,” it said.

Macadamia nut production of 1 076 tonnes, Tanganda said, was nearly equal to last season due to dry weather experienced during the season. The macadamia market is shifting to kernel from the traditional nut-in-shell market, resultantly exports declined by 16 percent from 800 tonnes in the prior year to 670 tonnes in the year under review.

“Global prices of nuts declined from an average of US$5,12 per kg achieved in the prior year to US$ 3,26 per kg in the current year.

“To mitigate these developments, the company has identified alternative markets and strategies that include exploring value addition options.”

On coffee exports, the diversified company indicated that a total of 96 tonnes were 14 percent above 84 tonnes achieved in the prior year.

Average export selling price of US$6,56 per kg remained slightly firmer than prior year price of US$6,50 per kg.

Packed tea volumes into the regional market recorded a 57 percent growth from 218 tonnes in the prior year to 343 tonnes.

Tanganda Tea Company Completes 4,4 Mega Watts (MW) Solar System!

“Overall packed tea sales volumes of 1 994 tonnes were nine percent below 2 191 tonnes in the prior year. Logistical delays arising from global supply chain disruptions resulted in a lower local packed tea order fulfilment percentage especially in the peak winter season but this has since improved significantly.

“Liquidity challenges affecting disposable income in the economy further impacted the level of sales volumes,” said Tanganda.