PGMs top forex earner
PHILLIMON MHLANGA
In the first 11 months of 2024, cumulative mineral sales of 3.9m metric tonnes (MT), valued at US$2.6m, were recorded, Business Times can report.
This marks a decline compared to the same period last year, which saw sales of 3.2m MT valued at US$3m. The decline in both value and volume terms is attributed to depressed global mineral prices, a phenomenon that deepened during the period under review.
Despite these challenges, Platinum Group Metals (PGMs) continued to lead as the top revenue earner in the sector, with lithium and high-carbon ferrochrome maintaining strong performances.
“PGMs remained the cornerstone of the country’s mineral exports, generating a staggering US$1.3bn in revenue during the review period,” Minerals Marketing Corporation of Zimbabwe (MMCZ) Acting General Manager, Dr Nomsa Moyo said.
She added: “This impressive figure underscores the sector’s resilience and importance to the economy, even amidst a global downturn in commodity prices.”
The consistent demand for PGMs in automotive catalytic converters, jewelry, and industrial applications has helped sustain its position as the leading revenue earner.
Dr Moyo said efforts to enhance the value addition of PGM production have been pivotal.
Local beneficiation initiatives, such as refining and smelting operations, have been aligned with the objectives of the National Development Strategy 1 (NDS1). These initiatives not only maximize revenue but also contribute to job creation and the development of downstream industries.
Lithium exports secured the second spot, bringing in a total of US$457m. This performance highlights the growing global demand for lithium, driven by its critical role in the production of batteries for electric vehicles (EVs) and renewable energy storage systems. The country’s vast lithium reserves have positioned it as a key player in the global EV supply chain.
Strategic partnerships and foreign direct investments in lithium mining and processing have bolstered this sector. The government’s focus on promoting value addition has also encouraged the establishment of lithium battery manufacturing plants, which will further enhance the sector’s revenue potential.
High-carbon ferrochrome (HCFC) exports ranked third, generating US$311.5m.
Despite challenges in the ferroalloy market, the sector has remained a reliable contributor to mineral export revenues. Ferrochrome is essential in stainless steel production, and its demand is closely linked to global industrial and construction activities.
The adoption of energy-efficient smelting technologies and the modernization of processing facilities have been key to maintaining competitiveness in this sector. Additionally, government incentives aimed at attracting investment in ferrochrome production have supported its steady growth.
While the mineral sector continues to be a cornerstone of the economy, the decline in global commodity prices presents significant challenges. Lower prices for PGMs, lithium, and ferroalloys have impacted revenue, underscoring the need for diversified strategies to mitigate market volatility.
The government’s commitment to promoting value addition and beneficiation is a crucial step in this direction.
By processing raw minerals locally, the country can capture more value, reduce reliance on raw material exports, and create a buffer against fluctuating global prices. Moreover, efforts to improve transparency and accountability in mineral resource management will enhance investor confidence and ensure sustainable growth.
The National Development Strategy 1 (NDS1) has been instrumental in shaping the sector’s strategic priorities. Key objectives, such as value addition, accounting for mineral resources, and increasing revenue, have guided policy decisions and investments.
The government has also prioritized infrastructure development, including energy and transportation, to support mining operations. These initiatives aim to address bottlenecks that hinder production efficiency and competitiveness. Furthermore, collaborations with international partners in research and technology transfer are expected to unlock new opportunities in mineral exploration and processing.
Looking ahead, the mineral sector is poised for growth, driven by the continued demand for PGMs, lithium, and ferroalloys. Investments in exploration and processing facilities, coupled with government support for value addition, will strengthen the sector’s resilience and revenue-generating capacity.
However, the industry must navigate challenges such as environmental sustainability and the need for skilled labor.
Embracing green technologies and adhering to sustainable mining practices will be crucial in maintaining access to international markets and meeting the expectations of environmentally conscious consumers.
