Oliver Kazunga Bulawayo Bureau
ZIMBABWEAN gold producers have been urged to continue producing more despite the global mineral’s demand remaining subdued at 964 tonnes in the second quarter. According to the World Gold Council’s latest gold demand report, the yellow metal’s demand on the international market was four percent lower year-on-year.
This was attributed to slow inflows into gold-backed exchange-traded funds (ETFs), which have created a weak comparison against the highs of last year, contributing to the lowest half-year demand since 2009. Zimbabwe is one of the major gold producers on the continent.
“Gold demand stayed soft in second quarter to 964,3 tonnes. The first half total of 1, 959,9 tonnes is the lowest since 2009.
“ETFs inflows have steadied at low levels in recent quarters, making for weak year-on-year comparison,” said the WGC in a latest report.
In separate interviews, economic analysts urged local miners not to remove their foot from the pedal as the prices for commodities on the international market fluctuate from time to time depending on the forces of demand and supply.
“That report is correct to say that gold demand on the international market is currently subdued. The implications are that for all god producers, Zimbabwe included, we won’t be able to realise as much as we would have wanted if the price is low and the demand also is low,” said economist Mr Luxon Zembe.
“So, it means our expectations in terms of income from gold will also go down once the demand and prices are subdued.
“But what is important is to continue with the thrust for production and put it in the reserves.”
WGC also indicated that mine production in the second quarter improved by three percent year-on-year to 836 tonnes, the highest second quarter output performance on record as projects in Russia, Indonesia and Canada continued to ramp-up.
Another economic analyst, Ms Wendy Mpofu said despite the muted demand of gold on the international market in the second quarter, the mineral can be used as a security for borrowings.
Another economist Ms Chipo Warikandwa echoed similar sentiments adding that fluctuation in demand for the yellow metal experienced on the international market in the second quarter of the year was minor. She urged gold producers to continue producing more.
This year, the Government targets 30 tonnes of gold up from 24 tonnes produced in 2017.