Zimbabwe sold about 1,9 million tonnes of minerals valued at roughly US$1,5 billion in the first half of 2024
Zimbabwe’s mineral exports declined 26 percent during the first half of 2024, weighed down by declining global prices, the Minerals Marketing Corporation of Zimbabwe (MMCZ), the sole agent for mineral exports said.
The country sold about 1,9 million tonnes of minerals valued at roughly US$1,5 billion in the first half of 2024.
While this represents a 25 percent increase in sales volume compared to the same period last year, it falls short of the targeted sales of 2 million tonnes and US$2,03 billion in revenue, the MMC said in a statement.
Dr Nomusa Moyo, MMCZ’s acting general manager attributed the missed projections to a decline in global mineral prices. This resulted in a 6 percent volume shortfall and a significant 26 percent revenue shortfall.
Prices for lithium, nickel, coal, and coke dropped significantly compared to budget forecasts, Dr Moyo said.
Lithium prices plummeted 72 percent, nickel by 20 percent and coal and coke by 13 percent and 39 percent respectively.
However, there were some bright spots.
Prices for platinum, rhodium, copper, fluorite, and chrome concentrates all increased year-over-year. Platinum rose 6 percent, rhodium 6 percent, copper 16 percent, fluorite 2 percent, and chrome concentrates 4 percent.
However, the increases were not enough to offset the negative impact on overall revenue.
The top three contributors to mineral export revenue in the first half of 2024 were platinum group metals (PGMs) in both matte and concentrate form, followed by spodumene, Zimbabwe’s primary lithium export.
Despite missing initial targets, mineral export performance indicates a continuing growth in mineral sales volume.
Low mineral export volumes create a domino effect that weakens Zimbabwe’s economy, impacting the wide economy.
Lower export volumes directly translate to less foreign currency entering the country.
This disrupts the flow of hard currency needed for essential imports like fuel, medicine, and machinery.
With less foreign currency available, the Zimbabwe dollar weakens against other currencies.
This makes imports more expensive, leading to inflation and decreased purchasing power.
Mining companies rely on export revenue to operate and low export volumes can force them to cut costs, leading to job losses and reduced investment in the sector. This further weakens the economy and increases unemployment.
Analysts have noted that the global market’s influence on commodity prices exposes a vulnerability in Zimbabwe’s mining sector.
To mitigate the risks and ensure long-term economic stability, we need to look at beneficiation of the minerals.
Beneficiation refers to the processing of raw minerals to increase their value and marketability.
By focusing on beneficiation, Zimbabwe can transform raw materials into higher-value products, fetching a premium price in the global market.
This not only insulates the country from the vagaries of weakening commodity prices but also creates additional jobs and fosters technological advancement in the mining sector.-ebusinessweekly
