Conrad Mwanawashe Business Reporter
CHINA’S fifth largest ferrochrome producer, Yuanda Juhua, is exploring opportunities to build smelters in Zimbabwe to secure raw materials for its business. Three senior officials from the Yuanda Juhua group are in the country for meetings with the Minerals and Marketing Corporation of Zimbabwe, particularly Applebridge, the special purpose vehicle set up to facilitate chrome trade in the country.
The three officials who include, Mr Lee Ma the group’s senior manager, Mr Mou Biliang, assistant to the chairman and purchasing general manager and Mr Michael Chen, are visiting Gweru today to meet small-scale chrome miners. The Chinese group’s coming is a follow up to the engagements the MMCZ held with ferrochrome and ferro-nickel buyers in China late last month, as Government implements plans to ensure improved returns from minerals while dealing directly with customers internationally. Until recently, Zimbabwe was losing millions to middlemen who were supplying to China, the biggest buyer of chrome. Mr Lee said in an interview yesterday that they were in the country to understand the investment climate and to secure raw materials.
“We want to understand the policies and investment culture and to see how we can secure raw materials from Zimbabwe. We need a lot of raw materials and there is need for us to secure the source of material supplies. We also want to do some other investments in Zimbabwe,” said Mr Lee. Yuanda Juhua group handles 300 000 tonnes of ferrochrome per year, but is undertaking an expansion project to build further four smelters in China, which will double its annual capacity to about 600 000 tonnes. This will take the group to be the second largest ferrochrome producer in China by end of next year. Our group has a big vision for Zimbabwe. We are looking at how we are going to set up a company and at opportunities to build smelters in the country,” said Mr Lee. The group set up a company in South Africa recently to also secure raw materials from that country but is keen to establish in Zimbabwe.
“The second step is how we can invest in a mine but we will engage the MMCZ on how to structure such a corporation. Our medium to long term strategy is to build smelters in Zimbabwe so that we can produce the ferrochrome locally and export to Europe, America and other parts of the world,” said Mr Lee. MMCZ director Mr Masimba Chandavengerwa, said the visiting officials will engage small scale miners who were allocated claims surrendered by Zimasco.
“We have always said that we would want to have direct relationship with our customers so that they invest directly with our small scale miners so that they can secure their requirements. After our visit to China, we invited most of the customers to come through Zimbabwe on their way to the international conference in South Africa early next month. We are pleased that some of them are coming through and this is a very big group in China that has seen it fit to follow up on this invitation,” said Mr Chandavengerwa. They are going to Gweru to discuss with some small scale miners who were allocated claims but do not have capacity to mine. So our customers will work with the small scale mines assisting them to produce the quantities and qualities they require. MMCZ and Applebridge will facilitate the exports as usual. The next phase is being at the source in terms of smelting so they are seriously thinking in terms of setting up a plant or two in Zimbabwe so that they can smelt here closer to the source of the raw materials and then supply high carbon ferrochrome to the rest of the world.”