The sugar producer said it will build the 500 million rand ($39 million) refinery at its Xinavane Mill, north of Maputo, with the first production expected in September 2018.

Mozambique is a net importer of sugar, although consumption is lower than in neighbour Zimbabwe, the company said.

"Production from the Xinavane Refinery will replace imports and the refinery design will provide for efficient future expansion to match growth in the local market and in export opportunities," said the company in a statement.

The Johannesburg Stock Exchange-listed Tongaat, which has operations in South Africa and Zimbabwe, has a production capacity of 250,000 tonnes of brown sugar at the Xinavane mill.

Tongaat said it aims to increase domestic sugar sales in Mozambique by expanding the distribution network and reviewing package sizes to match affordability.