Sinosteel Corp’s Zimbabwean unit will increase its ferrochrome output by more than a quarter by 2012 following the repair and upgrade of one of its six furnaces, an official said on Monday.
Sinosteel, which owns 73% of Zimbabwe Mining and Smelting, or Zimasco, has announced plans to invest $300 million into the firm to build a new smelter and ramp up production in Zimbabwe’s largest ferrochrome producer.
Zimasco is currently operating below its installed capacity of 180 000 tonnes of high-carbon ferrochrome as one of its six furnaces is down, the company’s services director, Josephat Zvaipa, told a parliamentary committee hearing.
“Our current production is 165 000 tonnes, excluding one furnace which is being rebuilt. We should do 230 000 tonnes by 2012 when the sixth furnace comes back on stream,” Zvaipa said.
Zimbabwe’s three major smelters have a combined capacity to process 1,5 million tonnes of chrome ore. The country produced 500 000 tonnes of chrome ore in 2010, according to Chamber of Mines figures.
Zimbabwe, which has 12% of the world chromite reserves, has seen its ferrochrome output dip from 5% of global production in 2000 to 1,2% currently.
Ferrochrome is produced by electric arc melting of chromite, iron magnesium chromium oxide and chromium ore.
Over the years, Zimbabwe has been forced to export raw chrome due to lack of the special smelting furnaces required, thereby depriving the country of the benefits of exporting value added products.
In its submissions to the portfolio committee small-scale miners said government should avoid sending signals that curtail entrepreneurship and investment as the business community thrived on on consistent policies that instill confidence.
Zvaipa said Zimbabwe’s competitiveness was being eroded and yet it was one of the biggest producers of chrome with 12% of the world’s chromite deposits while the biggest producer, South Africa, had 72% deposits of the world’s chromite resources estimated at 7,6 billion tonnes. —Reuters/Business Reporter