malvernmugadzikwa
Senior Business Reporter
ZIMBABWE’S platinum and lithium sub-sectors have remained resilient against the worst global economic shocks such as depressed metal prices, Mines and Mining Development Minister Winston Chitando has said.
Platinum is one of Zimbabwe’s biggest exports, along with gold, the country’s single largest export.
Lithium is the mineral of the future because of its use in the production of electric vehicle (EV) batteries.
In recent years, global metal prices, except gold, have dipped, ultimately impacting adversely on the production of platinum group metals (PGMs), as well as lithium, among other extractive commodities.
The World Platinum Investment Council recently indicated that the platinum market recorded a deficit of 878 000 ounces in 2023.
Although supply fell by 2 percent, while demand spiked by 25 percent year-to-year, this failed to lift prices.
Global lithium prices have plummeted from US$80 000 per tonne in 2022 to under US$20 000 per tonne. This has been largely attributed to the glut of lithium on the market and rising interest rates, which affected demand for electric vehicles.
In an interview last week, Mines and Mining Development Minister Winston Chitando told The Sunday Mail Business that the country’s mining industry, due to its efficiency, optimisation and expansion programmes, had managed to hold its own despite the low global mineral prices.
Global demand for gold remains strong, as investors turn to the yellow metal as a safe haven asset, amid economic uncertainties and the effect of geopolitical issues.
Consequently, the price of gold on the world market has increased from about US$1 900 per ounce in September 2023 to the current US$2 500 per ounce.
“Apart from gold, most of the commodity prices are very depressed. And certainly for Zimbabwe, the only mineral at the moment which we produce significantly and has firm prices is gold.
“The other mineral prices are very depressed and I would like to state that Zimbabwe’s mining industry has been very resilient and it’s an efficient sector.
“Generally, the trend in the world is when the mineral prices are low, most economies are characterised by mine closures — but this has not happened in Zimbabwe’s platinum and lithium sectors at a time when the world has experienced the worst commodity prices.
“The prices should start picking up now and us not having any one of our mines shutting down when prices reached their worst, it’s really a success in itself,” he said.
When prices start firming up, Minister Chitando said, the local mining industry will benefit from that because none of the companies has lost its installed capacity.
“We have managed to maintain our installed capacity of the various minerals in spite of the very weak commodity prices.
“So, the Zimbabwean mining sector is a very resilient sector and more importantly, despite these weak commodity prices, the platinum and lithium industries have actually increased installed capacity,” he said.
“We have witnessed, over the last 12 or so months, increases in installed capacity through expansion and optimisation programmes by various companies.
“But the bottom line is we have experienced some form, though not significant, of increase in installed capacity through expansion and optimisation — again that’s a positive.”
Platinum is among the globe’s scarcest metals and is used primarily in the production of automotive catalytic converters, in the electrical and chemical industry, as well as petroleum sector. And with only three operational mines — Zimplats, Mimosa and Unki — the country is the world’s third largest platinum producer, accounting for 9 percent of the global output, behind South Africa and Russia.
Other projects at different stages of development include the US$2,5 billion platinum project by Great Dyke Investments in Darwendale; Karo Resources’ US$4,2 billion project in Mhondoro; and a multimillion-dollar initiative by Bravura Consortium, which is still in its infancy.
With the largest lithium deposits in Africa and ranking seventh in production in the world, Zimbabwe continues to implement projects to ramp up production amid expected growth in demand for the mineral for EV batteries production.
So far, active producers in the country include Prospect Lithium Resources, Bikita Minerals and Sabi Star.
Several other major firms, including Premier African Minerals’ Zulu lithium and tantalum project in Insiza district, Matabeleland South province, are anticipated to start operations soon. These will contribute to the expansion of the local lithium industry.
The rise in demand for lithium and battery minerals is due to the global growth of green energy industries that are involved in the manufacture of electric motor vehicles and energy storage devices, among other items.
“We have also witnessed, again, over the past 12 months, in spite of these reduced commodity prices, continued exploration in various areas in the country, which again is a good thing that, as a country, we have continued to see investment to discover new deposits.
“All these initiatives are really in line with His Excellency’s mantra for the achievement of an upper middle-income society because, as we always say, an upper middle-income economy is measured by the Gross Domestic Product (GDP) per capita, and income per capita, it’s a function of the GDP in the economy and the population,” said Minister Chitando. At a time when global commodity prices were depressed, he said, the local mining industry continued to invest in value addition and beneficiation.
“Again, during this period of the depressed commodity prices, we have witnessed companies continuing to invest in value addition and beneficiation. Of course, at different levels, without really going into specifics . . . some in the platinum sector have continued to invest in beneficiation and value addition in spite of the weak prices.
“As far as the lithium sector is concerned, we have also witnessed the same. But more importantly, we have witnessed the plans by the lithium sector to go on to the next stage of value addition, which is really in line with the vision by His Excellency, the President.
“As a Government, we are proud of the platinum and lithium sectors and we urge them to continue to be efficient,” he said.
In 2022, the Government and two Chinese investors — Eagle Canyon International Group Limited and Pacific Goal Investment — signed a memorandum of understanding for the development of a US$13 billion
mine-to-energy industrial park in Mapinga on a piece of land covering 5 000 hectares (ha).
The project, the first of its kind in Zimbabwe, is expected to boost the economy through the beneficiation of minerals, and underpins the Government’s commitment to implement clean energy projects as critical enablers to leapfrog the country’s modernisation and industrialisation.
Furthermore, it is hoped that the proposed facility will mark the inception of the lithium-ion battery value chain in Zimbabwe. This will set the country among the world producers of lithium-ion batteries, while contributing to the growth of a resilient clean global energy economy.
In a recent interview with this publication, Permanent Secretary in the Ministry of Mines and Mining Development Mr Pfungwa Kunaka said at least 500ha had been cleared as part of the process to facilitate the development of the energy park. Under the first phase of the project, US$4 billion would be spent.
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