Zimbabwe rakes in US$1bn from minerals in Q1

Zimbabwe's mineral production reached US$970,5 million in the four months to April with gold accounting for 38% of that amount at US$383,8 million, official data has shown.

Statistics compiled by the Minerals Marketing Corporation of Zimbabwe (MMCZ) seen by Standardbusiness revealed that the country's small-scale gold producers contributed the most, accounting for 5,3 tonnes, while large- scale producers and secondary producers contributed 3,3 tonnes and 595kg respectively as at end of the period under review.

Gold production in the southern African nation has been on a steady increase in recent years, but output was severely dented in the second half of 2018 when Fidelity Printers and Refiners Limited (FPR) started making part payments in local currency to miners.

The payment arrangement saw a lot of the gold being sold on the informal market while some was smuggled out of the country.

FPR is a subsidiary of the Reserve Bank of Zimbabwe, which is mandated to buy gold on behalf of the state. It has since introduced an incentive, which is expected to boost gold production.

The incentive is in the form of a gold support price of US$1 368, 28 per ounce (US$444 000 per kg).

According to FPR, the gold support price and the duration of the facility will be reviewed from time to time.

Palladium and platinum production amounted to $148,3 million and $108,7 million respectively in the four-month period.

The value of gold produced in April amounted to $93,7 million compared to $115 million in the preceding month while platinum recorded a marginal increase to $28,7 million from $26,7 million.

Palladium and diamonds remained flat at $39 million and $11 million respectively in April.

Nickel recorded a major decline from $14,2 million in March to $9,6 million in April, while chrome fell from $20,9 million in May to $15,1 million in April.

Other major minerals in terms of value contribution were high carbon ferrochrome at US$96,1 million, chrome (US$73,9 million), nickel (US$49,8 million) and diamonds at (US$48,3 million) in that order.

In volume terms, chrome reached 513 000 metric tonnes, nickel (5 300 metric tonnes), diamonds (617 000 carats), platinum (4 500kg) and palladium ( 3 800kg).

The government still maintains an ambitious target of generating in excess of US$4 billion from mineral revenue, up from US$3,4 billion earned last year driven by an anticipated growth in gold production.

Last year the country's gold output reached an all-time high of 33,2 tonnes and authorities are targeting to increase production to 40 tonnes in 2019, but it remains highly unlikely given the slump in deliveries being recorded.