MINES minister Walter Chidakwa has disclosed that the government is losing millions of dollars in potential revenue by allowing chrome miners to export the mineral in its raw form instead of beneficiated ferrochrome, which fetches a higher price on the international market.
BY BLESSED MHLANGA
Addressing journalists in the capital yesterday, Chidakwa said the ministry was now toying with the idea of banning raw chrome exports.
He said last year, raw chrome exports amounting to 284 943 tonnes only generated $31 million against 149 131 tonnes of high carbon ferrochrome, which earned the country $115 million.
“This is why we need to put the ban in the first place. When you look at the figures for 2016, you think we have done very well, $31 million. You now need to move on to high carbon ferrochrome, in 2016, we produced 149 131 tonnes and the total earnings were $115 million. You see the imperative for value addition, you see why we keep saying we need the establishment of beneficiation plants,” he said.
The country’s leading high carbon ferrochrome exporters, Afrochine Smelting, shipped out 66 000 tonnes of the metal earning $53 million in 2016.
Zimasco, which is now under judicial management, only exported 12 000 tonnes and earned slightly above $10 million in the year under review.
Chidakwa said the ministry was lobbying the government to ring-fence the cost of electricity for chrome producers from 67 cents to 4 cents per kilowatt hour to promote beneficiation of chrome ore.
“It is critical to note that any future development in the chrome sector should have a favourable ring-fenced power tariff for the smelting as an incentive to the development of value addition for the production of ferrochrome and ultimately steel,” he said.
Meanwhile, the government has seized 50% of chrome ore claims held by Zimasco, which it will now parcel out to small-scale chrome miners as special grants.
Chidakwa said the seizure was in line with the indigenisation policy.
Another chrome smelter, ZimAlloys, according to the minister, is yet to release 50% of its chrome ore claims.