Low prices worry chrome miners

By The NewsDay | Apr. 28, 2021 | 2 Min read

ZIMBABWE’S mining industry says chrome sector growth continues to be undermined by poor prices offered by buyers.

BY FREEMAN MAKOPA

ZIMBABWE’S mining industry says chrome sector growth continues to be undermined by poor prices offered by buyers.

Ferrochrome exports form a significant part of minerals that Zimbabwe trades on the international markets every year.

Although the country is targeting to transform its mining industry to a US$12 billion sector by 2023, the sector currently generates about US$2 billion per annum, with chrome exports contributing US$15 million.

Other key minerals produced in Zimbabwe include gold, platinum and diamonds.

Zimbabwe Miners Federation spokesperson Dosman Mangisi on Monday said chrome ore under-pricing and international trade disruptions triggered by COVID-19 had become the biggest threat to miners.

“The current state of chrome is a bit down due to a number of issues, mainly pricing and COVID-19,” Mangisi said.

“The sector is losing potential revenue due to a lot of agents on the ground and under-pricing. Prices offered by the Chinese (who have emerged as the biggest market in the past decade) are very low. Chrome miners are suffering, particularly small-scale miners,” Mangisi added.

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“I cannot say we have a ready market. The current buyers are failing to absorb what is on offer. The prices are trending at US$60 and US$80 per tonne depending on the grades,” he said.

This is far below the prevailing prices on the international markets.

In 2015, government reversed a ban on chrome ore exports that had been introduced in 2011 in an effort to force miners to value-add the mineral before shipping it out.

Zimbabwe has the world’s second-largest high-grade chromium ore deposits of approximately 10 billion tonnes, around 12% of global reserves, according to the Mines and Mining Development ministry.

These reserves are only second to South Africa.

But the chrome-rich nation produced just 866 000 tonnes of chrome ore in 2019, accounting for only 2,5% of global output, according to the International Chromium Development Association.