8 November 2017

Zimbabwe: Gold Output Jumps 11pc

Gold production for the month of October jumped 11 percent, the highest year to date, driven by increased deliveries from small-scale miners. Gold output for the month stood at 2 770 kilogrammes, up from the September figure of 2 494kg. Small-scale miners produced 60 percent of the total gold produced in the month at 1 672kg while the remaining 1 098kg came from primary producers.

Overall gold production has been on a steady increase since January. In the third quarter, gold production rose 33 percent to 7 162kg compared to the second quarter's production of 5 363kg with artisanal miners making the biggest contribution to total production. This, however, comes as the average selling price for the yellow metal fell 2,6 percent to $1 279 per ounce compared to $1 314 per ounce in September.

Zimbabwe Miners' Federation public relations manager Dosman Mangisi said while small-scale miners contribution was significant, there was still need for Government intervention in the supply of mining machinery as manufacturers are battling foreign currency shortages. This is affecting the small-scale mining sector's efficiency and productivity. This, he said, called for relevant authorities to prioritise manufacturers of mining equipment in the allocation of foreign currency to ease deficiencies in the sector.

"There is need for Government to assist companies that manufacture and supply mining equipment on forex allocation which is their concern right now. This will allow miners to purchase the machinery at more affordable prices," he said.

Since the beginning of the year, artisanal miners' contribution to the country's overall gold production has been on the increase. Last year, their contribution was around 45 percent but has risen above the primary producers. In recognition of their significant contribution, Government has come up with incentives such as the $20 million gold facility which was later increased to $40 million on significant drawdowns from small-scale miners.

Indications are that the Reserve Bank of Zimbabwe (RBZ) may further add another $30 million to the facility as it moves towards boosting the country's total gold production and attracting producers to sell their gold at Fidelity Printers and Refiners. This will also help plug loopholes in the gold sector where an estimated 1 000kg of the precious metal is being smuggled out of Zimbabwe, robbing the country of export revenue. Gold is the second largest export earner contributing 17 percent after tobacco at 21 percent.

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