daniel chigunwe
Business Writer
Zimbabwe is working on logistical issues to start commercial coal exports to China after conducting a trial run last year, an official said.
The lack of capacity by the National Railway of Zimbabwe (NRZ), coupled with high rail cost was making exports to the world largest consumer of the fuel unviable, Coal Producers Association chairman Linos Masimura said.
“That is major challenge we realised during the first trial run and we are working on it before we conduct the second trial run,” said Masimura, who is also chief executive of Zambezi Gas, a coal mining firm based in the coal-rich Hwange mining district.
The global energy crisis resulting from Russia’s war in Unkraine, drove up the demand for coal and prices and was best performer after surging 157 percent last year.
This is despite the year 2022 was full of volatility for commodity prices with global economic slump dampening the demand for most metals.
Coal prices had started rising even before the conflict as some European countries switched away from expensive natural gas to coal, despite global commitments to move away from the polluting mineral.
Local coal producers are also looking to export the fuel to Europe where some countries are reopening the mines.
In November 2023, London-listed Contango Holdings said it was planning to start exporting thermal coal early next year from its Zimbabwe mine following requests from customers in Europe and Asia.
Contango owns 70 percent of the Lubu project in western Zimbabwe’s coal-rich Hwange district.
The company’s main focus is supplying its low-sulphur coking coal to the southern African ferro alloy and industrial markets, but it has found current prices of thermal coal – used in electricity generation – attractive.
The company said it had received “unsolicited approaches” for thermal coal from buyers, ranging from trading houses to industrial consumers, in Africa, Europe and Asia.
Bongani Ndlovu