Andrew
Online Reporter
LOCAL base metals and steel producers are working under “extremely” difficult conditions, which has resulted in the closure of up to 30 companies since 1990, the Zimbabwe Institute of Foundries (ZIF) has said.
ZIF is a body that represents the interests of base metals and steel producers.
According to ZIF, the conditions under which base metals and steel producers are operating do not encourage beneficiation and value addition of the metals.
ZIF chief operating officer,Mr Dosman Mangisi, said a number of factors, chief among them the unavailability of raw materials, high tariffs and forex shortages, are contributing to an increase in the cost of doing business.
“In terms of value addition and beneficiation, the environment that we are operating under is making business costly. About 90 percent of the raw materials that are used in base metals and steel value addition are imported,” Mr Mangisi said.
“As a result of the imports, we are always chasing after forex to buy such raw materials as ferrosilicon, ferrochrome and ferromanganese among others. This makes business costly.”
He said local smelting companies are not capable of satisfying demand, with companies taking up to 90 days to make ferrochrome deliveries.
Ironically, Zimbabwe has vast resources of manganese, but most companies are not smelting the mineral into ferromanganese, a raw material used in base metals value addition and beneficiation.
Mr Mangisi called for the banning of scrap metal exports.
“South African companies are taking advantage of the scrap metal exports to make finished goods that the companies will then sell to Zimbabwean companies at great profit. Scrap metal exports should be banned and local companies must be encouraged to export finished products,” he said.
The demand for scrap metal by South African companies has resulted in an increase in the price of the commodity.
According to statistics provided by ZIF, in January this year, a tonne of scrap metal was going for US$90, but the figure has since jumped to US$300 per tonne.
Online Reporter