EABL launches construction of Sh15bn plant

Beer maker EABL #ticker:EABL has broken ground on its planned Sh15 billion brewery in Kisumu, signalling good tidings for thousands of farmers who will be contracted to supply raw materials.

The brewer, whose ground-breaking was officiated yesterday by President Uhuru Kenyatta, is projected to handle up to a quarter of the output by Kenya Breweries.

“The plant should be up and running in 18 months. We are hoping that the farmers around here will become more aggressive and bring in sorghum and millet we need,” said the Kenya Breweries Managing Director Jane Karuku adding that the county is ideal for the plant because it has adequate water.

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The launch of the factory involves installation of brewing equipment and refurbishment of other facilities. It will initially produce Senator Keg popular with low-end consumers.

The investment follows other spending of about Sh16 billion in the past five years focusing on production and supply of brews made from local crop such as sorghum and millet, in a project known as Grain to Glass. 

And with the company marketing keg as a safer alternative to illicit brews around the country, Ms Karuku said she expected the firm to expand further by benefiting from the market around the region.

President Kenyatta said at the launch that the project signals the rising confidence among investors thanks to improved business environment.

“We promised to revive all factories. That is what we are doing. And we will continue to create an environment to see that all collapsed industries are open again,” he said.

Sitting on 55 acres on the edge of Lake Victoria, the plant will initially process only Senator keg but it is expected to expand operations up to a quarter of the company’s production capacity.

KBL says keg production could increase by one million hectolitres after Kisumu starts operations.

The plant was shut down in 2002 in what Kenya Breweries said was sufficient capacity at the Nairobi plant, as well as opening of a plant in Port Bell by its affiliate Uganda Breweries. The factory was then mothballed, occasionally being used as a depot even as employees lost their jobs. Now the company says it cannot sustain the market with the Nairobi factory only.

“It is also an opportunity for us to exploit regional markets across the borders in Uganda, South Sudan and Tanzania. In future, we plan to expand so we can meet the rising demand in these markets.”

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