Carew eyes higher output to meet growing liquor demand

With foreign liquor in short supply amid a face-off between the NBR and private diplomatic bonded warehouses over the use of a software developed aiming at checking misuse of the duty-free import facility, demand for the local Carew & Co brand of alcohol has seen a marked rise.

According to Carew officials, sales of liquor produced by the company went up by more than 50% in October-December this year compared to the corresponding period of the previous year.

Buoyed by the sales boom, the government is thinking of expanding the company. 

Commerce Minister Tipu Munshi yesterday announced that the Carew & Co will have a second unit at its present site in Darshana to enhance its production capacity as there is demand for other byproducts like alcohol, vinegar, hand sanitiser and organic solvents.  

The announcement was made in presence of the industries minister at the inauguration of sugarcane crushing programme at the Darshana Sugar Mill.

The usual monthly sales of the Carew & Co's liquor were around 12,500-13,000 cases of liquor, but the figure rose to 18,579 cases this October and 19,446 cases in November.

Muhammad Mosaruf Hossain, managing director of Carew & Co, told The Business Standard the firm expects that the sales volume will cross 20,000 cases this month as it has had higher demand orders from its 13 warehouses and three sales centres across the country.

To meet growing demand, Carew and Company (Bangladesh) Limited – a state-owned sugar mill that produces alcohol as a by-product from the crushing of sugarcane – has increased production in its two distillery plants. The company produces liquor on-demand from its designated warehouses, and sales centres.

Previously, the company used only 50% of its existing production capacity and produced 12,000-14,000 cases every month. But the volume has gradually risen, reaching over 20,000 cases this month. In October, the company produced around 18,000 cases of liquor and the figure was approximately 19,000 cases the following month.

The company is setting up two new sales centres in Cox's Bazar and Kuakata – two tourism hubs in the country.

The distillery unit has long been a money spinner for Carew & Co and a significant rise in sales of alcohol over the past several years has helped the company turn profitable for the first time in its life span as its profit from the distillery unit outstripped the consolidated losses counted by other units in the 2017-2018 fiscal year. And since then, the company has kept posting profit every year, riding on ever increasing revenue earned from the sales of liquor.

And now, with demand for its liquor going up further, the company hopes to rake in more profit in future.

Speaking to TBS, managers of several bars said the market is now seeing a shortage of foreign liquor.

The crisis began as the existing six private diplomatic bonded warehouses in the country called a strike after the NBR (National Board of Revenue) made the use of software mandatory from 2 July this year. The strike left the country's liquor market dry.

Against such a backdrop, consumption of Carew's liquor has increased recently, the bar managers said.

Carew's distillery unit

The main product of Carew & Co is sugar. But after extracting sugar from sugarcane, various products are produced as by-products, which include local liquor, foreign liquor, vinegar, spirits and organic fertilisers.

The company manufactures country spirit (CS), rectified spirit (RS), and denatured spirit (DS), and two types of vinegar named malted vinegar and white vinegar.

The overall production capacity of the company's two distillery plants of CS, RS and DS is 1.35 crore proof litres.

The highest production so far was 52.76 lakh proof litres – half of the capacity remaining unused as market demand was low.

Carew has nine brands of "foreign liqueur" – Yellow Level Malted Whiskey, Gold Ribbon Gin, Fine Brandy, Cherry Brandy, Imperial Whiskey, Sarina Vodka, Rosa Ram, and Old Ram.

The company markets liquor in 180ml, 365ml, and 750ml bottles.

All designated warehouses of the company have recently been placing higher demands, said officials, adding that the warehouses in Dhaka and Srimangal, however, have outstripped others in this regard.

According to officials, one case contains 12 bottles of 750 ml, 24 bottles of 465 ml, and 48 bottles of 180 ml liquor.

Moves to meet growing demand

Carew & Co has three sales centers in Dhaka, Chattogram and Darsana of Chuadanga district.

Now the company is setting up another two sales centers in Cox's Bazar and Kuakata of Patuakhali district. It wants to establish three more warehouses as well.

According to sources, the company also plans on increasing liquor production through automation instead of using the manual system.

The project is under process, said officials, adding that once implemented, it is expected to double production capacity.

Carew MD Mosaruf Hossain said, "Under the new marketing plan, the management has decided to establish three warehouses and two sales centers. We've sought permission from the narcotics control department in this regard."

"The narcotics department has approved the two sales centres. Now the company will sign a memorandum of understanding (MoU) with the Parjatan Corporation to get the sales centres," he added.

Aim to make sugar unit profitable

The government is implementing a Tk102.21 crore project for BMRE (balancing, modernisation, rehabilitation and expansion) of Carew & Co.

The tenure of the project, initiated in July 2012, has been extended several times up to June 2022. Under the project, the sugar plant will be renovated to increase production.

The company has been incurring losses year after year in all its units, including sugar and commercial firms, except for the distillery segment.

The accumulated loss incurred by the sugar segment stands at Tk642.79 crore.

Asked how the sugar unit will turn profitable, ending the current loss-making trend, the company's managing director said, "Production will increase after the renovation of the factory. We hope the company will be able to post profit within four years [of the renovation]."