Gold deliveries fall 5%
LIVINGSTONE MARUFU
Gold deliveries to Fidelity Printers and Refiners (FPR) fell 5% to 1.38 tonnes in April 2021 from 1.46 tonnes recorded during the same period last year due to depressed exploration and low levels of mechanisation, latest statistics have shown.
In March, it had appeared producers had warmed up to delivering the yellow metal to FPR. Apparently, deliveries had for the first time in more than a year on month on month improved by 2% to 1.80 tonnes from 1.77 tonnes reported in the prior comparative period.
However, the deliveries are declining again.
FPR general manager Fradreck Kunaka told Business Times this week that there was a need to equip miners with machinery rather than to depend on gold rushes.
“The gold deliveries to Fidelity were 1.38 tonnes in April 2021 against 1.46 tonnes delivered to us during the same period last year. The decrease could be attributed to a number of factors chief of which being depressed exploration for mining thus in the event of a lowering of mined ore grade, mines struggle to quickly recover,’ Kunaka said.
“On the artisanal and small scale miners from, the low level of mechanisation is the significant contributor to the low deliveries.”
During the period under review, small scale miners, which had in recent years been producing the bulk of gold, last month delivered 0.63 tonnes while primary producers delivered 0.75 tonnes to FPR.
Overall, gold deliveries for the first four months of the year fell 25% to reach 5.36 tonnes from 7.18 tonnes during the January to April period in 2019.
In January 2021, from the output of 0.997 tonnes, primary producers delivered 0.64 tonnes against small scale producers who managed 0.355 tonnes. In February 2021, the small scale extracted 0.56 tonnes and primary producers delivered 0.61 tonnes.
Recently, Kunaka revealed that the country could be losing over 30 tonnes yearly valued at US$1.7bn due to smuggling as a result of unfavourable mining policies.
He said the country should totally liberalise the gold sector to combat smuggling and compete at the highest level with foreign gold buyers.
Kunaka warned Zimbabwe to invest in gold mining equipment rather than depend on the gold rush as it is not sustainable.
“Much of the gold delivered to FPR tends to come from gold rush areas thus when there are no gold rushes, the deliveries get depressed,” Kunaka said.
Meanwhile, Gold Miners Association of Zimbabwe chief executive Irvine Chinyenze said the authorities should move with speed to curb leakages.
“As long as we still have high taxes, high cost of mining and cost of importing cash we are bound to have subdued deliveries to FPR but if the government addresses these challenges the deliveries will surge.
“The authorities should not be fooled by the assumption that low gold deliveries are caused by lack of mining equipment, yes we need to be equipped, but there is intensive mining going on, only that miners are not delivering to them due to the sole buyer’s punitive measures,” Chinyenze said.
The country’s gold output plummeted 31% to record 19.052 tonnes in 2020 from 27.66tonnes recorded during 2019 due to Covid-19 effects, delay in payments and low foreign currency retention levels.
Recently, mining experts advised the government to pay gold producers at world prices to woo them into selling the yellow metal through the formal channels.
They blamed FPR’s flawed centralised gold buying scheme and called for the law to bring complicit powerful politicians to book as they are believed to be sponsors of machete gangs’ violence in Midlands and Mazowe.
The recent report said the development of the gold sector is crucial if the President Emmerson Mnangagwa’s administration is to salvage prospects for Zimbabwe’s economic recovery from decades of economic stagnation.
