Re-building Zimbabwe’s iron & steel economy through industrial linkages: The potential of the Manhize Project and the road back to continental leadership

By Eng. Paul Matshona Eng. Martin January

Steel is the backbone of structural transformation.

It underpins capital formation in transport, energy, housing and industrial machinery while transmitting productivity gains to a wide constellation of upstream and downstream activities.

Zimbabwe once grasped this logic. For decades Ziscosteel at Redcliff coordinated a dense web of coal, limestone, refractory, rail, engineering and construction linkages and, at its peak in the late 1980s to early 1990s, produced around one million tonnes per year, ranking among Africa’s top producers outside South Africa

Following Ziscosteel’s collapse, the Manhize integrated iron and steel project developed by Dinson Iron & Steel Company (DISCO), a unit of Tsingshan marks an historic re-entry into primary steelmaking. Commissioned in mid-2024, Manhize began with pig iron and moved into carbon steel production in 2024/2025, with Phase 1 nameplate output of approximately 0.6 Mt/year and expansion plans toward 1.2 Mt/year.

In our previous discussions, the emphasis was on how linkages between mining and downstream industries serve as a fundamental instrument for building Zimbabwe’s jewellery manufacturing ecosystem. This discussion now shifts focus to iron mining and steelmaking, examining how these can be transformed from a solitary greenfield operation into the anchor of a re-integrated industrial ecosystem.

The goal is to revitalise both upstream and downstream linkages, positioning Zimbabwe once again as Africa’s pre-eminent steel-producing nation. It proceeds in three moves: theorising linkages, mapping Manhize’s current linkage architecture, and setting out the missing pieces power, logistics, standards and market organisation required to scale from domestic import substitution to regional dominance.

Industrial Linkages: Theoretical and Policy Frame

Albert Hirschman’s classic insight that development proceeds by exploiting “unbalanced growth” and then coordinating backward and forward linkages maps cleanly onto steel.

Backward linkages include iron ore mining, coking coal, limestone, fluxes, refractories, scrap collection and energy. Forward linkages ramify through long products (rebar, sections, wire rod), flat products (hot-rolled coil, plate), downstream fabricators (fasteners, mesh, pipe), engineering services, capital goods, and ultimately large infrastructure programmes that internalise steel demand.

In contemporary conditions, four adjustments are essential. First, energy is not a mere input but a co-production system: blast furnaces and basic oxygen furnaces require abundant, reliable megawatts; waste-gas recovery, on-site captive power and hybrid routes (BF/BOF plus EAF using pig iron and scrap) become part of industrial design rather than afterthoughts. Second, global overcapacity and volatile prices force producers to differentiate via product mix and logistics reliability rather than just tonnage.

Third, environmental performance especially decarbonisation pathways, fugitive emissions control, slag valorisation and water stewardship conditions finance and market access. Finally, standards and certification (ISO/ASTM/SANS/SAZ) are the trade passport into public procurement and cross-border projects.

The Manhize System as a Linkage Anchor

Current footprint

Manhize is Africa’s newest integrated steelworks, designed as a vertically linked cluster: iron ore mining at and near Manhize/Mvuma; an integrated ironmaking and steelmaking complex; ancillary plants (oxygen, lime, potentially sinter/coke); and an embedded 50 MW thermal power station with additional power recovered from furnace gas. By late 2024 it had reached around 60% operating capacity on initial units and indicated a ramp-up to rolled long products. In 2025, the promoter announced an $800 million next-phase investment to double capacity towards approximately 1.2 Mt/year, with total electricity demand projected to exceed 500 MW at full build-out

Of strategic significance is DISCO’s group portfolio in Zimbabwe: ferrochrome assets, a coking coal platform in Hwange and lithium ventures each of which can be knitted into steel value addition and export logistics. The Hwange coking coal line has already reported production milestones, tightening the backward linkage between metallurgical coal and Manhize’s furnaces.

Resource base and domestic demand

Zimbabwe’s iron ore endowment often cited in policy discourse at tens of billions of tonnes provides geological depth for a multi-decadal steel programme, though rigorous, JORC-compliant resource audits specific to Manhize deposits should anchor planning. Policy narratives have quoted 30-40 billion tonnes nationally; the precise economically recoverable subset will track infrastructure, energy and market evolution.

Domestic latent demand spans public works (roads, bridges, dams), electricity transmission expansion, mines and smelters (lithium, chrome, PGMs), and an urban housing backlog each classically steel intensive. Regional pull factors have strengthened unexpectedly: ArcelorMittal South Africa announced the wind-down of its long-products business, opening a near-term Southern African supply gap precisely in the rebar and sections that Manhize can supply.

Logistics and market access

No steel plant is competitive without low-cost bulk logistics. The National Railways of Zimbabwe (NRZ) is the critical missing ligament. In 2024, NRZ indicated it needs approximately US$431m to build a 50-km link from Mvuma into the plant and to rehabilitate routes for inbound raw materials and outbound finished steel. Today, NRZ moves less than 3 Mt freight per year versus approximately 12 Mt in the 1990s, underscoring how rail reliability will determine Manhize’s delivered-cost curve into SADC markets.

Where Zimbabwe Stands Now

The headline fact is that Zimbabwe is back in primary steel. Phase 1 at Manhize is online, producing pig iron and carbon steel, with a concrete pathway to 1.2 Mt/year in the short to medium term.

This is not a notional “revival”; it is a functioning, ramping asset, supported by on-site 50 MW generation and furnace-gas power recovery, with solar capacity contemplated to improve energy resilience. Early trade data points and investor communications in 2025 suggest rising volumes of steel and iron exports, though these signals remain fragmented across public sources and should be consolidated into an official statistical series to guide policy.

Yet three structural constraints cap immediate continental leadership: (1) power Zimbabwe generates only about half of its  approximately 2,000 MW demand and is refurbishing thermal capacity at Hwange through a private concession to stabilise supply; (2) logistics railway throughput and dedicated sidings remain sub-scale; and (3) market organisation and standards product certification, procurement rules and downstream fabrication capacity are not yet fully aligned to absorb and multiply Manhize steel locally.

The Missing Linkages

1. Power as an Industrial Commons

Even at 1.2 Mt/year, Manhize’s electricity appetite is greater than 500 MW at full configuration. Without a bankable energy stack a mix of captive thermal, furnace-gas recovery, grid tie-in, and contracted renewable/PPA capacity steel output will face curtailment and cost volatility.

The first phase’s 50 MW plant and waste-gas recovery to cover approximately 20% of needs is a solid start, but grid stability must rise in lockstep with steel expansion. Nationally, the Hwange refurbishment concession with Jindal Africa (US$455m over 15 years) is a critical complement, but the sequencing and wheeling arrangements for large industrial offtakers need to be explicit in policy and PPAs

2. Rail-First Logistics

The economics of ore, coal, limestone and outbound steel demand rail. A dedicated 50-km Mvuma-Manhize link and brownfield rehabilitation across Kwekwe-Redcliff-Gweru corridors are non-negotiable. NRZ’s openness to private operators (e.g., Grindrod units on NRZ tracks) provides a template for a Steel Corridor Concession a vertically coordinated rail solution with: (i) ring-fenced track maintenance funded by a per-tonne access charge; (ii) dedicated locomotives/wagons; and (iii) service-level agreements linked to plant cadence.

3. Deepening Up- and Down-stream Fabrication

Zimbabwe must avoid a thin equilibrium of “billet-and-rebar only”. A resilient ecosystem includes oxygen, lime, refractories; structural long products (H-beams, channels); plate; galvanised and coated products; welded tube and pipe; wire rod to drawn wires to fasteners; mesh and fencing; pressure vessels; and heavy fabrication for mining and power.

The collapse of AMSA’s long-products business in South Africa creates a time-limited window to capture SADC demand, but this requires standards (SANS/SAZ equivalence), accredited labs, and vendor-qualification pipelines for regional EPCs and state-owned utilities.

4. Finance and FX Architecture

Because steel is FX-intensive (spares, electrodes, alloys, rolling mill equipment), macro policy must offer predictability on retention thresholds and duty drawbacks for exporters. A dedicated Steel Export Finance Facility revolving, with export proceeds ring-fenced to service rolling capital would dampen liquidity shocks. Export credit agencies can be mobilised for the logistics PPP and phase-two rolling mills.

5. Technology & Human Capital

A modern integrated works is a data plant as much as a metallurgical one: Level 2/3 automation, predictive maintenance, yield analytics, energy optimisation, and scrap management are competitive levers. Zimbabwe’s technical colleges and ZSM should co-design Steel Skills Academies with DISCO: BOF/EAF operators, refractory technologists, rolling mill automation engineers, and NDT inspectors feeding not just Manhize but a national fabrication revival.

6. Environmental Performance as Strategy

Manhize’s furnace-gas power recovery and planned solar are positive. Scaling slag valorisation (cementitious materials), water recycling, and dust capture to best-available standards will unlock concessional green finance and preferred-supplier status on regional infrastructure where ESG screens are rising.

How Zimbabwe Becomes Africa’s Largest Producer Again

“Largest” must be defined carefully. Egypt and Algeria each produce multiple millions of tonnes annually; South Africa remains significant despite turbulence; Libya’s LISCO has large nameplate capacity though intermittently utilised. Achieving continental leadership is therefore a trajectory problem: Zimbabwe can plausibly become Southern Africa’s dominant long-products supplier over the next investment cycle, then graduate into plate/HRC for regional engineering demand. The strategy is fourfold:

(1) Lock in a 3-stage capacity path. Consolidate 0.6 Mt to 1.2 Mt (current plan) to 2.5–3.0 Mt by adding a second steel shop and downstream rolling (rebar/sections + plate/coil). Each stage must be contingent on (a) power PPAs/captive increments, (b) rail throughput commitments, and (c) certified market off takes with EPCs and public works. Recent announcements already set the 0.6 to 1.2 Mt step through an $800m investment tranche

(2) Convert Southern Africa’s supply shock into market share. With AMSA exiting long-products lines, Zimbabwe can fill gap markets (rebar, sections, wire rod) if it guarantees consistent standards and delivery into Gauteng, Botswana, Namibia, Zambia and Mozambique. This calls for a “Steel Routes” logistics plan dedicated trains to Beitbridge and Maputo/Beira, bonded warehouses, and vendor registration with major contractors.

(3) Build a diversified product pyramid. Start with long products for infrastructure (bridges, grid towers, housing), add plate for mining equipment and pressure vessels, and eventually HRC/CRC for appliance and light automotive clusters. The market logic is cumulative: reliable rail and energy reduce marginal costs, widening viable product scope.

(4) Institutionalise a Steel Council. A tripartite platform (industry–state–finance) tasked with synchronising energy, rail, standards, and export intelligence; publishing quarterly steel balance sheets (capacity, utilisation, import/export flows); and coordinating skills and R&D with universities and ZSM. South Africa’s steel policy history shows that dispersion of coordination functions leads to attrition; Zimbabwe must centralise coordination while decentralising enterprise execution.

Risks and Mitigations

Global Price Cycles. Steel is notoriously cyclical. Hedge with a balanced product mix and regional contracts tied to large infrastructure programmes. Input Volatility. Secure long-term coal/coke contracts within Zimbabwe’s resurgent coal sector and integrate furnace-gas and solar PPAs to buffer electricity volatility. Logistics Delays. Ring-fence the rail corridor under a PPP with enforceable milestones and penalties. Policy Credibility. Provide stable export retention rules and fast-track standards accreditation; publish a Steel Master Plan with binding public-procurement local-content schedules.

Manhize is more than a plant; it is an opportunity to re-compose Zimbabwe’s industrial structure around a high-multiplicity sector. The country has re-entered primary steelmaking with live furnaces, a realistic near-term expansion to  approximately 1.2 Mt/year, a deep resource base, and a regional demand window sharpened by South Africa’s retrenchment in long products.

The constraints power, rail, standards, downstream depth are solvable with targeted, time-sequenced interventions: an industrial power corridor; a rail PPP anchored by take-or-pay steel tonnage; downstream incentives tied to standards and exports; and an institutional steel council to coordinate the policy stack.

This is how Zimbabwe becomes not merely “a producer” again, but a Southern African steel system whose linkages multiply national income, rebuild engineering capabilities, and credibly position the country for continental leadership over the next investment cycle.

Paul Matshona is a mining Engineer and Researcher at the Zimbabwe School of Mines, specialising in sustainable mining systems, environmental governance, ESG, responsible mining, and de-risking strategies for small and medium-scale mining operations.

Martin January is a financial and Mining Engineer, and Training & Operations Manager at the Zimbabwe School of Mines, focusing on financial modelling, operational efficiency, technical and financial valuation, and capacity-building in the mining sector.