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Mineral output forecast to jump 11%

by Staff reporter
08 Jun 2021 at 06:30hrs | Views
Mining companies expect an 11 percent growth output in the second half this year, after seeing production fall across key minerals in the first quarter, the Chamber of Mines of Zimbabwe (CoMZ) has said.

Outgoing CoMZ president Elizabeth Nerwande told the miners Annual General Meeting (AGM) and conference in Victoria Falls last Friday that production was projected to rebound and help the sector to meet its annual targets.

The Indaba was held under the theme "Navigating Turbulent Times, Sustaining Mining Industry Growth Amidst Covid-19". President Mnangagwa officially opened the event, graced by several other high profile delegates.

This year's event also saw Unki Mines chief finance officer Collin Chibafa taking over as the new CoMZ president on a two-year term, deputised by Golden Reef chief executive Thomas Gono (first vice president) and Zimasco commercial director John Musekiwa.

Mrs Nerwande said overall production fell 4,7 percent last year, weighed down by the negative impact of the Covid-19 pandemic and other challenges while production fell across key minerals in the first quarter.

Volume declines over the 12 months to December 2020 were recorded in gold, lithium, high carbon ferro-chrome, chrome ore and copper while platinum, palladium, rhodium, diamonds and cobalt registered expansion.

"Most of the key minerals recorded declines in the first quarter of 2021 again compared to the same period in 2020.

And despite the subdued first quarter performance we anticipate that the mining sector will have a rebound and grow by 11 percent in the second half and attain the annual targets that we have," she said.

Mrs Nerwande said they have agreed as CoMZ to draw lessons from last year to understand, learn and react to unfolding events with the chamber now putting place structures to decipher the unknown future.

CoMZ, after the experience of 2020, has started a one stop resource centre to make sure that information is up to date and that all players in the sector share the same vision with stakeholders and the Government.

Mining firms are happy about the rapport they have established with the Government, resulting in speedy resolution of issues presented to policy makers, but say sticking areas remain that continue to weigh down the sector.

Mrs Nerwande said over the past two years, the chamber had worked with the Government, which saw improvement in some areas. But she pointed out that a number of areas still require improvement to enhance competitiveness.

"There is need for significant improvement in ensuring that the policy environment is stable and competitive. We got quite a number of areas that are still outstanding. The Mines and Minerals Act Amendment, which is still under consideration; the same boat for the computerized mining cadastre system and completion of comprehensive mineral development (policy).

"We also appeal to the Government to align and fiscal policies in the foreign currency usage and management and to allow exporters in the industry to have sufficient resources to grow and sustain the business," he said.

Mrs Nerwande said the miners have experienced persistent shortages of critical and imported inputs, due to the continued effect of limited foreign currency, low retention levels and the high effective exchange rate used by some suppliers.

She said the mining industry welcomed the removal of the exports liquidation period and applauded the Government for introducing the incentive scheme on incremental exports, which is expected to boost production.

But she noted that gold miners have experienced delays in the settlement period for deliveries to Fidelity Printers and Refiners, which for some producers lasted up to eight weeks, crippling their ability to import critical supplies.

The coal sector was also badly affected by shortage of foreign currency, being predominantly a non-exporting sector. She said corrective measures should be taken urgently in order to restore viability and energy security.

With multiple payments to the Government, she said, user fees paid to local authorities had become a huge burden, which requires streamlining. She said while power supply had stability, the quality of supply remained an issue due to regular faults.

‘We implore the Government to render support to the utility in order to build capacity for efficient service delivery" , she said. "We applauded the Government again for removing the equity threshold on diamonds and platinum for indigenisation, thereby standardising the indigenisation policy for the mining industry."

However, the outgoing CoMZ president called on the Government to gazette the relevant legislation in this regard.

Source - the herald

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