Awash Wine’s Mekanisa plant expansion project, shown here in late 2018, is expected to start production in March 2019.

The oldest winemaker in Ethiopia has finalised a two-million-dollar expansion project that will boost its production capacity to 8,000ltr an hour.

Awash Wine S.C,  located in Nefas Silk Lafto District, is undertaking the expansion on a 2,500Sqm area in its Mekanisa plant, which is expected to start production in March 2019. The company claims that the new project will triple its production capacity at the Mekanisa plant.

Saber Construction Engineering and ETAM Construction Plc undertook the civil work that commenced in November 2018. EMH Consulting Engineers & Architects Plc, a seven-year-old company that previously consulted on the construction of Mizan Tepi University classrooms and is currently supervising Techno Company Construction, serves as the on-site supervisor and consultant on the project.

The electro-mechanical work was executed by Ningbo Lehui International, a Chinese food and beverage equipment manufacturer.

Imported from Italy, Germany and China, the machines include bottle washers, fillers and corkers as well as a capsule sealer and dryer. Once operations commence, the new plant will enable the company to expand its employee base by 88, adding to the current 633 permanent workers at its two wineries, and an additional 500 contract workers employed at its vineyards.

Awash Winery is upgrading its facilities and improving its products in response to increased demand and anticipated long-term growth in the market, according to Biruk Amante, public relations manager at Awash. The Winery produces six wine products under the brands of Awash, Kemila, Axumit, Gebeta, Awash Plus and Gouder.

The company, which has an 80pc share of the local wine market, has embarked upon the expansion project amid a new proposed law, which will ban the advertisement of beverages with less than 10pc alcoholic content on any of the broadcast media. The contentious bill was legislated by parliament last week and will become effective in three months time.

Awash is also planning to export its products, according to Biruk.

“We have sent sample products to Eritrea, and we’re currently getting ready to start exporting to China,” Biruk told Fortune.

Awash Wine harvests its grapes from its vineyards located 180Km southeast of Addis Abeba on a 517ha plot where they grow a variety of grapes for wines including Petit Syrah, Barbera Nebiollo, Chenin Blanc and Dodoma.

In September 2013, Blue Nile Investment, a partnership between 8 Miles, a UK-based private equity firm chaired by prominent Irish singer-songwriter Bob Geldof, and Mulugeta Tesfakiros, founder of Muller Industries, which operates Muller Real Estate and Langano Bekele Molla Hotels, acquired the plant for 460 million Br. The company is the third winery in Ethiopia along with Castel and Kana.

Awash has a bottling capacity of 11.5 million bottles, while Castel and Kana have respective production capacities of 1.2 million bottles and 500,000 bottles of wine annually.

Founded in 1943 by two Greek and Italian families and nationalised by the Dergue in 1973, Awash Winery produced 10 million litres of wine in the 2016/17 fiscal year.

An expert applauds the expansion of the plants.

Creating more job opportunities, increasing the wine supply for both local consumption and the export market are the major benefits of the expansion, according to Hailemariam Kebede (PhD), a lecturer at Addis Abeba University’s School of Commerce.

Hailemariam also suggests the management of the company use an alternative way to advertise its products to retain its market share in the wine market.

In the last fiscal year, Ethiopia spent 60.75 million Br to import wine botteld.

“As the advertisement on broadcast media is banned, the company should consider participating in community events and corporate social responsibility as an alternative marketing strategy,” he said.

PUBLISHED ON Feb 09,2019 [ VOL 19 , NO 980]

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