Chrome ore output low

13 Jun, 2017 - 03:06 0 Views

The Herald

Business Reporter
The country’s chrome ore output for the first quarter of 2017 stood at 316 625 tonnes slightly lower than the annual projection of 375 000 tonnes. Of the recorded figure, about 113 571 tonnes was exported as raw ore while 203 054 tonnes was value added and exported as high carbon ferrochrome. “Chrome ore production continues to be largely driven by the huge demand in China which has pushed up chromium prices,” said Finance and Economic Development Minister Patrick Chinamasa is his first quarter bulletin released last week.

The slight drop in chrome production comes at a time when small scale chrome miners have warned Government of a possible boycott from investors and buyers due to the unfavorable pricing structure being offered by the Minerals Marketing Corporation of Zimbabwe.

Small chrome miners say that the existing pricing structure is not inclusive of distribution costs of the mineral to the final destination hence rendering them uncompetitive.

As part of efforts to address issues surrounding the chrome mining sector, the MMCZ has lined up stakeholders meetings across the chrome mining areas in the country.

The meetings are aimed at reaching consensus and documenting concerns being raised by small scale chrome miners affecting their production.

Minister Chinamasa said international mineral prices for major minerals such platinum, gold, nickel and palladium are projected to firm up.

He said going forward the mining sector is anticipated to bring in about $3 billion in export earnings during 2017, given the rebound in most international mineral prices, including those of chrome.

Minister Chinamasa said the projected growth of about 5,1 percent is being driven by key minerals of gold, platinum group of metals (PGMs), chrome and nickel.

“Notwithstanding lower output for some minerals such as coal, gold and diamonds, the first quarter saw a huge lip in chrome production.

“Temporary setbacks for gold were on account of flooding due to incessant rains, with output recoveries anticipated during the second quarter,” said Minister Chinamasa.

During the period January to March 2017, Minister Chinamasa said cumulative gold output stood at 4 637 kg, marginally lower than the 4 711 produced during the same period last year.

He said production was adversely affected by excessive rainfall received during the month of February which reduced throughput due to flooding.

However, the share of Small to Medium Enterprises continues to rise with the 2017 first quarter output at 2 083 kg against 2 033 kg of the same period in 2016.

Minister Chinamasa said cumulative platinum output for the first two months of the year stood at 2 418 kg, against the annual target of 15 500 tonnes.

He said production growth is anticipated from primary producers, bolstered by firming international prices, expected to surpass the $1 000 per ounce mark in 2017. In addition, the export incentives are also expected to stimulate production.

“Growth is also expected to increase in related minerals such as palladium, rhodium and ruthenium, among others,” said Minister Chinamasa.

Total diamond output for the period under review stood at 567 024 carats, 6 percent lower than 603 590 carats produced in the comparable period of 2016.

“The decline in diamond production is attributable to the transitional challenges involving the consolidation of former diamond companies into one State company, the Zimbabwe Consolidated Diamond Company (ZCDC), since February 2016.

“In 2017, diamond production is projected at 1.9 million carats underpinned by envisaged successful capitalisation and full production at ZCDC,” he said.

Minister Chinamasa said Government is already working on addressing challenges related to legal wrangles and capitalisation of ZCDC.

Furthermore, ZCDC secured equipment to the tune of $30 million and is expected to support higher throughput.

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