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No cheers for chrome miners

CHROME ore mining companies are yet to benefit from the lifting of a ban on exports of chrome ore of up to 30 million tonnes amid indications that little will be exported this year pending finalisation of export licences.

BY TARISAI MANDIZHA

Government lifted the four-year ban on the export of chrome ore in June to enable the sector to mobilise financial resources and invest in technology.

Ferrochrome producer, ZimAlloys, said although it had received a number of enquiries from potential strategic partners for the mining of alluvial concentrates since the lifting of the ban, the deals could only be concluded after government modalities were released.

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Ferrochrome is made from smelting chrome ore and is widely used in the manufacturing of stainless steel.

ZimAlloys judicial manager Reggie Saruchera said the world market prices for chrome ore were currently depressed, largely due to the slow-down in the Chinese economy and this was affecting the market for chrome.

Saruchera said “very limited volumes were likely to be exported this year due to the pending finalisation of export licences and the impact of the rainy season on mining activities.”

ZimAlloys controls 40% of local chrome reserves. Zimbabwe has three smelters that are in operation — Zimasco, Afrochine and Xin Yu, while five others — Oliken, MonaChrome, ZimAlloys, Maranatha and Wel Mine — were closed due to low chrome prices.

Saruchera said the cash-flows for the exporting companies were expected to improve with the lifting of the ban on chrome ore exports and the profits realised from chrome ore exports would go towards refurbishment of furnaces and restoration of smelting capacity.

“Significant financial benefits are also expected to accrue to government, small-scale miners, transporters and suppliers of equipment and services. Employment creation will also be one of the significant downstream benefits,” Saruchera said.

Government has set up a special purpose vehicle (SPV) — Apple Bridge — which small-scale miners can use to export chrome ore or concentrate. In addition, government says every raw chrome exporter shall pay a royalty of 5% and a prescribed permit fee of $500 as part of regularising the export of chrome ore.

Saruchera said ZimAlloys was yet to receive the new set of rules from government.

The Zimbabwe Artisanal and Small-Scale Miners’ Council president Wellington Takavarasha said small-scale miners had not yet realised anything tangible since the lifting of the ban.

He said the lifting of the export ban was expected to create employment around communities both up and downstream, easing the liquidity challenges currently faced by the country to enable poverty reduction.

“We feel the small-scale miners of chrome, through their body, must be awarded an export licence. We are not fully engaged in the exercise despite government saying the SPV was for small-scale miners of chrome,” he said.

Takavarasha said small-scale miners were weighed down by an absence of technical expertise and mining machinery and implored government to give incentives by supporting indigenous miners.

“About 78% of small-scale miners are on tributes of Zimasco and ZimAlloys. Only 10% are independent miners,” he said.

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