Zambia: Zambian Breweries to increase production capacity by 1 million hl

Zambian Breweries, a Central African brewing company owned by AB InBev, has announced an US$30 million investment program, raising production capacity from currently 850,000 hl to 1.85 million hectoliters at its Ndola brewery, Zambia Daily Mail reported.

The money will be used for a new packaging line and a new warehouse.  “We have brewing capacity in Ndola but we do not have enough packaging,” said country director Annabelle Degroot. “We cannot produce enough so the packaging line will increase our capacity,” she added.

The company already spent US$350 in modernization and capacity enhancement in the last five years. Latest major investment was a new malting plant at Zambia’s capital Lusaka with a yearly production capacity of 15,000 tons of malt. The plant is used to transform locally grown barley into brewing malt, with two thirds of the production being used in the own two breweries and one third being exported to neighboring countries (, 3.4.2017).

The country’s government has lowered last year excise tax from 60% to 40%, thus reducing smuggling beer into the country and increasing demand for locally produced goods.

Zambian Breweries started as Northern Breweries, a private company founded in 1963 by South African Breweries (SAB) and Labatt Breweries of Canada as an 80%/20% joint venture. In 1968, the government nationalized SAB’s shareholding. In 1988, also Labatt sold its stake and the company was renamed Zambian Breweries. As part of the Government’s 1990's privatisation program, the company was divided into two separate entities, each operating one brewing site. The brewery in Lusaka, which was  named Lusaka Breweries and later renamed to Zambian Breweries (ZamBrew), was later sold again to SAB. In 1999 Zambrew bought 100% of the shares of the other brewery in Ndola, called Northern Brewery, giving the company again a monopoly in the clear beer market. When SABMiller itself was bought by AB InBev last year, ownership of Zambian Breweries was handed over to the world’s largest brewer.

Ms. Degroot is confident that AB InBev will help the company to further increase its business: “The new shareholder has placed Nigeria, South Africa and Zambia as important markets and has pledged commitment to expanding the businesses in these three countries,” she said.

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