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Chrome

Business Reporter
THE Minerals Marketing Corporation is directly engaging foreign chrome ore buyers to achieve premium prices and better returns for small-scale producers in a bid to cushion them from middlemen who are taking advantage of low global prices and profiteering at the miners’ expense.

While global chrome ore prices have plummeted to around $50 per tonne from about $180 per tonne six months ago, MMCZ, a Government agency charged with supervising the sale of all minerals produced in Zimbabwe except gold and silver, said it had been able to negotiate and achieve higher prices of $80 per tonne.

There had been a spirited campaign by the Confederation of Zimbabwe Small-Scale Chrome Miners, a lobby group representing small-scale miners to pile pressure on MMCZ to have a lesser role on marketing of the commodity, arguing that market forces should determine prices. But MMCZ insisted that as part of its mandate, it will not allow the country to suffer from low global chrome ore prices.

According to market reports, some South African companies have been piling pressure on MMCZ to sell ore at subdued prices, which they later sell to China and India when the prices recover.

“In light of the subdued global prices MMCZ has been engaging buyers to ensure that achieved negotiated prices are higher than what small middlemen are offering,” said MMCZ. “MMCZ remains committed to protecting the small-scale miners and the nation from unscrupulous middlemen burnt on profiteering at the expense of Zimbabwe’s miners.

MMCZ said it had been holding stakeholder workshops, explaining the market situation particularly the prevailing international prices. It said genuine small-scale miners appreciated the stance by MMCZ of negotiating for better prices rather than settling “for any price thrown on the table by middlemen”.

“Just last week, MMCZ made presentations at the ZMF Small-Scale Miners conference during Mine Entra, wherein MMCZ reiterated its stance on ensuring that miners are not short changed by middlemen.”

MMCZ said it was quite aware of the “unscrupulous elements” feeding the media with falsehoods”, claiming the agenda of “such false stories which are quite also confusing”.

The marketing agent said the pricing of chrome ore was not just thumb sucked but methodically worked using benchmarks of material from other producing countries such as Turkey etc.

Global chrome ore producers benchmark prices against the low grade UG2 from South Africa. This approach works well when the market is firm and prices are going up. “However, when prices are dropping especially to current levels, other considerations come into play.

“For example, the viability of the mines cannot be overlooked,” said MMCZ. Over the years Zimasco, a unit owned China’s Sinosteel and ZimAlloys had enjoyed the monopoly of the chrome mining sector and owned over 80 percent of the mining claims.

Small-scale miners participated in the chrome industry only as tributors to these two multinational companies. To ensure wider inclusion of indigenous players in the chrome sector the Government then directed that 50 percent of the claims held by the two companies be released to other small-scale players.

Zimasco ceded 22 000 hectares of land on Zimbabwe’s famed mineral-rich Great Dyke to the Government.