KBL breaks ground for Kshs 15 billion plant in Kisumu

Kenya Breweries Limited (KBL) broke ground on a Kshs 15 billion plant in Kisumu which President Uhuru Kenyatta touted it  as the largest investment in the city that will spur the regional and national economy.

The Kisumu plant started operations in 1984 but was closed in 2002 due to improvements in beer production technology that helped create excess capacity in beer production at the Nairobi brewery. The re-opening will help plug fresh demand for Senator, a hugely successful beer product launched in 2004, targeted at the low-end of the market.

It will become operational within the next 2 years.

President Kenyatta lauded KBL’s commitment, saying it will spur the regional and national economy through creation over 1,500 direct jobs, while more will come from the 22,000 new farmers set to benefit from supplying the new brewery with sorghum. Combined with the distribution and retail ends of the value chain, the new plant is expected to employ over 100,000 jobs.

KBL MD Jane Karuku said,“I t is great news for Kenya’s economy and particularly the people of Kisumu who have been asking when we will return after halting production in 2002. This investment constitutes 25 percent of the total annual capital expenditure for Diageo, our parent company – a resounding statement of confidence with government.

It follows our capital expenditure investments totaling 16 billion Kenyan Shillings in the last 5 years alone, taking our total investment to over 30 billion, spent on expanding our local raw material sourcing, production, distribution and retail capacity across Kenya.”

She said KBL’s strategy focuses on the ‘From Grain to Glass’ value chain which is now projected to double the market for sorghum as a cash crop, from the current 20,000 metric tonnes to around 40,000 in the next five years.

Read: Empower sorghum farmers to benefit from the Ksh 15B brewery project 

The climate in Nyanza is one of the most conducive for sorghum and millet production and the location of the plant will immensely benefit the local farmers. Gross additional farmer earnings are expected to reach over Kshs. 6 billion annually over the next 10 years boosting rural economies.

Senator Keg production is anticipated to increase by 1 million hectoliters in the first 5 years of the Kisumu plant operation, while the number of sorghum farmers is projected to grow from the current 30,000 to around 45,000 farmers due to the high demand. As a result, consumption of illicit alcohol is likely to reduce from the current 50 percent to less than 20 percent over the next five years.