LIVINGSTONE MARUFU
Zimbabwe’s gold deliveries for the first 10 months of the year earned the country $1,1 billion in foreign currency receipts. This comes as deliveries surpassed the all-time record achieved nearly two decades ago at 30,3 tonnes.
Reserve Bank of Zimbabwe governor John Mangudya told Business Times that production of the precious metal increased by 44 percent from the corresponding period last year driven by small and artisanal miners.
The highest gold output Zimbabwe had ever achieved was 27,1 tonnes in 1999, which only raked in $244 million in export earnings.
This year’s record breaking gold output is mainly attributed to export incentives and increased government support, particularly to small-scale and artisanal gold miners.
Government increased its gold fund facility to $150 million early this year from $20 million at its inception in 2016.
Buoyed by the facility, small scale and artisanal gold miners, who in the past two years have emerged as the cornerstone of the sector, have already surpassed their self-set target of 20 tonnes for this year.
Of the 30,3 tonnes produced this year, small scale and artisanal miners, who last year smashed production records upstaging large goldmining companies for the first time in 10 years, have continued to dominate, contributing close to 70 percent of total production output.
Gold deliveries from large scale miners increased 12,47 percent in October but a huge 56 percent drop from small scale miners saw overall gold deliveries close 41,07 percent lower in the same month.
This is the second worst monthly performance after the 2 015,54kg recorded in February, which traditionally gets affected by the rain season. However, in spite of the dip in performance the country has surpassed its initial 2018 target of 30 tonnes (30 000kg) as the cumulative deliveries closed at 30 266,86kg. The total national figure is much higher if deliveries from the PGMs are added in. The new target is at 34 tonnes.
The latest figures from Fidelity Printers & Refinery show that gold deliveries from small scale miners fell to 1 199,13kg from 2 720,86kg recorded in September. This brings the total brought in by small scale miners to 20 439kg, which is two-thirds of the country’s total.
Large scale producers brought in 849,3kg from 755,1kg. May remains the highest performing month for the sub-sector at 1 182,75kg while for the small scale miners, August brought in the highest at 3 026,04kg. As a result of the August performance from the small scale miners, the third quarter has been the highest performing with deliveries amounting to 10 945,22kg.
The Zimbabwe Miners Federation said that the major challenge in October was fuel, which is one of the major consumables (for compressors mainly) for the mining sector. According to ZMF public relations officer Dorsman Mangisi, operations suffered from major downtime.
He also said the forex challenges continued to weigh as the 30 percent payout that is supposed to be in bond notes became a liability after the bond note lost value following earlier pronouncements by the Finance and Economic Development Minister. The Reserve Bank of Zimbabwe uses a 70-30 split in paying out small scale miners.
