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Minister Walter Chidhakwa

Lovemore Zigara, Midlands Correspondent
The Government is considering a downward review of its 28-tonnes gold target projection for this year due to loss of production since January largely as a result of heavy rains that flooded most mines.

Small scale miners were the hardest hit by rains forcing many to suspend operations while big corporates also slowed down production.

The Government is pinning its hopes on the mining sector to shore up foreign exchange through exports with gold production – one of the key minerals – expected to earn the country $1, 2 billion.

Despite a surge in gold production in January this year as compared to the same period last year, the figure still falls below the 2, 4 tonnes average, which local miners should produce if the country is to achieve its 28 tonnes gold target set by Government this year.

According to January statistics from Fidelity Printers and Refineries (FPR)- the country’s sole buyer of the yellow metal – gold production stood at 1, 637 tonnes for January up from 1,459 tonnes over the same period last year.

February gold statistics also showed a 11 percent decline in gold deliveries when compared to those of January.

Mines and Mining Development Minister Walter Chidhakwa said: “We have been monitoring the last two months and the expectation was that we would achieve a 20 percent growth on a monthly basis. In volume terms for January and February, we have been around seven percent, which makes it difficult for us to achieve the 28 tonnes gold target we had committed”.

The minister, however, hinted that the country would make up for the lost production in the first months with an increase in output expected in the coming months when the rains subside.

“We are also confident that gold prices will surge during the course of the year, which will cushion us from the loss of production in the early months,” he said.

Chamber of Mines chief executive officer Mr Isaac Kwesu said it was too early to say that the gold target would not be achieved pointing out that mines always have a very slow start to the year in as far as production is concerned.

“Production usually picks up in the second half of the year and any talk of not achieving the projected target will be premature,” said Mr Kwesu.

Last year Zimbabwe managed to harness 9, 6 tonnes of bullion for the half year ending 30 June 2016 before production rose to 23 tonnes by year end.

The country missed its yellow metal target by one tonne after producing 13, 4 tonnes in the last six months of the year. Some big mines among them Metallon Gold and Falcon Gold have predicted a positive outlook for this year.

The Government has been working closely with mines particularly the gold sector to enhance improved output. Through the Zimbabwe Mining Development Corporation, for instance, the Government has availed $7 million for Sabi Gold Mine.

This will see the mine producing 25 kgs per month in the short term and production is expected to peak at about 50 kg per month according to Sabi Gold Mine judicial manager Mr Wesley Sibanda.

Equally bullish are the small scale miners who believe that through the interventions by the Reserve Bank of Zimbabwe (RBZ), production would surge during the course of the year.

The central bank availed a $20 million loan facility last year, which has since been doubled to $40 million for small scale miners, to boost gold production.

ZMF president Ms Appolonia Munzverengwi said: “Quite a number of our miners are accessing mining equipment through
the facility by RBZ. We are therefore still convinced that we will achieve the target and what gives us confidence is that the loan facility has been increased to $40 million, which means the number of beneficiaries will increase.

“The loan facility is looking at miners who are established with a history of delivering their gold to FPR and we are confident that they will increase production once they access the loan facility.”