Zimpapers Logo

Michael Magoronga, Midlands Correspondent

FERROCHROME producer, Zimasco Private Limited has temporarily switched off the Western Plant at Kwekwe Smelter amid viability challenges owing to a sharp decrease in global prices of the product.
Zimasco took over the plant in 2020 following the expiry of a five-year lease agreement between the company and South Africa-based Portnex International. Zimasco switched on the furnaces in November last year creating more than 200 jobs.

The closure of the two-furnaced plant means that the Eastern Plant, also with two furnaces, will be holding fort.

Responding to emailed questions, Zimasco spokesperson, Ms Clara Sadomba said the company was facing viability challenges due to the Russia-Ukraine war and the significant slowdown in economic growth in Mainland China among other challenges.

“The global market for ferrochrome ore has faced a number of challenges during 2022. The overall global economy has slowed down thereby reducing demand of prices throughout the year with August and September experiencing sharp decreases in prices at a time that production and logistics costs have increased,” she said.

The company had to take painful measures in a bid to arrest the unattainable situation hence scaling down operations by 50 percent.

“These circumstances have resulted in viability challenges for Zimasco’s ferrochrome production at this time and it has become necessary for the organisation to take certain measures to arrest this situation.

The company has therefore taken the decision to temporarily scale down the smelting operations by 50 percent of current capacity with effect from 2 September 2022 with two of our four furnaces at Kwekwe Smelter being switched off,” she said.

Ms Sadomba said the company will continue monitoring developments in the market and remains ready to respond swiftly should a change in the prevailing circumstances warrant it. Zimasco will, however, continue mining operations including the production of chromite ore concentrates that will remain operating at full capacity to support the build-up of strategic ore stocks ahead of the rainy season and export sales.

The company will also remain committed to its ferrochrome expansion programme at Kwekwe which is expected to boost capacity.

Zimasco commenced the US$100 million ferrochrome expansion project at Kwekwe this year which will see its smelting capacity double from 144 000 tonnes of ferrochrome per annum to 288 000 by 2023.

“The Ferrochrome Expansion Project consists of the construction of two refurbishment and modernisation of two furnaces at West Plant,” said Ms Sadomba.