WEAK local demand for yeast will see Lesaffre Zimbabwe (formerly Anchor Yeast) exporting to regional countries, a company official has said.
Lesaffre Zimbabwe sees exports of its products commencing in the second half of the year.
In an interview this week, the company’s MD Bernard Laguerre said the company will spend US$1 million of the US$2 million capital injection from Société Industrielle Lesaffre (Lesaffre) on new equipment to improve quality and lift production capacity at its Gweru-based factory with a view to export.
“The local market is not growing. In the second half of the year, we will be exporting. We would want to start exporting to Mozambique, Zambia, Malawi and South Africa by July or August . We want to export 30-40% of our produce,” Laguerre said.
Lesaffre Zimbabwe was formed after Anchor Holdings now Sinapis Investments sold 60% equity to Lesaffre in September last year.
According to Laguerre, Anchor Yeast was valued at US$14 million, implying the 60% acquisition by Lesaffre was done at a price of US$8,4 million.
The factory, which has been in existence since 1956, will be automised by putting new tanks and pumps in October this year as a prelude to increasing production capacity from the current 6 000 to 10 000 tonnes per annum by 2018.
It is estimated that Zimbabwe requires 5 400 tonnes of yeast per annum.
The company, which is the sole producer of yeast in Zimbabwe, has been struggling to stay afloat that in 2014 it lobbied parliament for a three-year ban on imports in a bid to save the business from collapse.
After the injection of fresh capital, it now supplies all beverages, bakeries in the country and is currently shrugging off competition from cheap imports due to improved product quality.
“At the moment, we have fresh yeast which we started manufacturing in January this year. As for breweries dry yeast, we have no competition because our clients don’t need cheap products,” he said.
He however said although there were a few pockets of imported active dry yeast from South Africa especially in small packages, they were not eating much into the company’s market share.
The firm’s Financial Director William Mironga said 90% of the raw materials were sourced locally.
Mironga said the construction of a US$20 000 baking school at its Harare branch which is set to be opened this September is earmarked to become the regional baking centre.
The company is now employing 115 employees up from 105 with more of them being deployed in the laboratories to ensure increased product quality.