The Sunday Mail
. . . earnings from value-added minerals up 283pc
Business Reporter
ZIMBABWE’S earnings from beneficiated minerals increased by 283 percent over two years since 2020, according to the latest official statistics from the Treasury.
This underscores the positive impact of Government’s thrust for beneficiation to boost mineral exports.
The remarkable growth represents a significant development for Zimbabwe as the mining sector serves as a key driver of the country’s economic growth.
As such, mineral beneficiation is undoubtedly amplifying the sector’s contribution to the economy, creating jobs and reducing reliance on revenue from the export of raw minerals, which is vulnerable to global price fluctuations.
While the recent surge in investment in the mining sector has been met with optimism, some analysts caution that more concerted efforts are required to fully unlock the country’s mineral potential.
Despite the increased investment being a positive sign, some analysts emphasised the need for continued efforts to attract further investment, enhance operational efficiency and embrace technological advancements to ensure Zimbabwe’s competitiveness in the global mining arena.
According to statistics, revenue from beneficiated minerals increased to US$4,6 billion in 2022 from US$1,2 billion in 2020, driven by gold, platinum, ferrochrome and diamonds.
Gold and platinum accounted for US$2 billion each. Ferrochrome, coking coal and diamonds accounted for US$347,6 million, US$130,7 million and US$121,7 million, respectively.
Zimbabwe’s aggressive approach to reducing raw mineral exports has played a crucial role in stimulating investment in beneficiation facilities.
In a bid to protect its ferrochrome industry and foster local value addition, Government imposed a ban on the export of unprocessed chrome ore in August 2021. This decisive action was followed by another strategic move in December 2022, when Government prohibited the export of unprocessed lithium.
These export restrictions have effectively incentivised investments in beneficiation plants within Zimbabwe, enabling the country to maximise the value of its rich mineral resources.
Over the past two years, Zimasco spent around US$6,8 million in upgrading and rebuilding its furnaces, as well as developing its mines to sustain production.
When the projects have been fully commissioned, Zimasco’s production capacity is expected to increase by 120 percent by 2025. Another ferrochrome producer, Jinyi, spent US$7,1 million on plant, transportation, furnace and sintering plant upgrades to increase production capacity by more than 20 percent by the end of 2024.
The investments by Zimasco and Jinyi are part of a wider trend of increasing investment in beneficiation facilities. Bikita Minerals has invested over US$300 million in exploration work and expansion of its operations over the past two years.
The mine has constructed and commissioned a dual lithium processing plant, the flotation separation plant and a new smelter plant. Production is expected to go up to 300 000 tonnes of spodumene concentrate and 480 000 tonnes of petalite.
Acadia Lithium Mine has spent in excess of US$300 million in capital expenditure programmes over the past three years. It commissioned its plant and commenced production in the first quarter of 2023.
At full capacity, it will be producing 400 000 tonnes per annum of lithium concentrate.
Sabi Star Mine commissioned its concentrator in August 2023. The concentrator has an ore processing capacity of one million tonnes per annum, with a lithium concentrate output of 300 000 tonnes per annum.
Zulu Lithium Mine started production in the first quarter of 2023 and has since commissioned a 50 000-tonne-per-year pilot plant valued at about US$35 million.
According to some analysts, these investments are a positive sign of the future of Zimbabwe’s mining sector.
Since the ban of raw lithium exports, shipments of the beneficiated battery mineral rose to 882 tonnes in 10 months to October this year, according to statistics from the Treasury.
In 2021, Dinson Colliery Company commissioned a US$30 million coke oven battery in Hwange, boasting a processing capacity of 400 tonnes per day. This significant investment marked a major milestone in the company’s operations and enhanced its ability to produce high-quality coke, a critical input for the steel industry.
The Zimbabwe Zhongxin Smelting ferrochrome plant in Masvingo is ready for commissioning.
Construction of the main plant is complete and work on a power substation is at 90 percent level.
According to Chamber of Mines Zimbabwe, platinum producers have indicated that Zimplats agreed to process other producers’ platinum group metals once the company finalises construction of additional smelters and refurbishment of its base metal refinery.
The producers have since signed commitment letters with Zimplats to regularise the arrangement.
This position was also agreed with Government.
Several lithium producers have entered into memoranda of understanding with Government to participate in the development of the mines to energy park, a transformative project aimed at maximising the value of the country’s mineral resources.
The project encompasses construction of two 300-megawatt power stations, a coking plant with an annual capacity of 1,2 million tonnes of coke, a 130 000-tonne-per-annum lithium salt plant, a graphite processing plant, a nickel-chromium alloy smelter and a nickel sulfate plant.
These ongoing beneficiation projects are indicative of the growing recognition of Zimbabwe’s vast mineral potential. By adding value to its mineral resources through local processing, Zimbabwe is set to reap greater economic benefits from its mining sector.
The projects are creating huge opportunities, contributing to socio-economic development across the country. Government’s supportive policies for the mining sector, coupled with the country’s rich mineral resource base, are creating a favourable environment for further investment in beneficiation projects.
As these projects progress, Zimbabwe is expected to emerge as a major producer of value-added mineral products, enhancing its position in the global mining industry.
“We welcome all the efforts meant to beneficiate the minerals but I think we are not yet at the point of celebrating,” economic analyst Dr Langton Mabhanga said in an interview.
“We need to implement a national natural resource beneficiation strategy that will compel actors in the exploitative industry to beneficiate. By doing so, we will be able to deliver a modern society, a modern industry and social infrastructure that align to Government’s aspiration of achieving an upper middle-income economy by 2030.”
Mr Carlos Tadya, a Harare-based economic analyst, said the investments in the mining industry were a positive sign for the future.
“These investments are expected to boost production, create better quality jobs and contribute to the economic development of the country,” said Mr Tadya.
The discovery of new mineral deposits, particularly lithium, has opened up new opportunities for the mining sector, he added.
From 2018 to 2023, the sector’s contribution to gross domestic product has steadily increased from 11,5 percent to 13,2 percent, reflecting its growing significance as an economic driver.
This positive trajectory is further underscored by the sector’s continuous growth since 2020, defying the challenges posed by the global pandemic and economic uncertainties.
