Mineral average capacity utilisation to increase to 90pc

Vuyisile Mlilo, Business Reporter

THE prospects for mineral output growth for 2024 have been projected to be higher than those recorded this year, while the average capacity utilisation for the mining industry is expected to increase to 90 percent in 2024, according to the State of Mining Industry Survey Report.

According to the report presented on the sidelines of the 26th edition of the mining, engineering and transport expo (Mine Entra) 2023 in Bulawayo on Friday, by lead researcher

Professor Albert Makochekanwa, he said ongoing expansion projects  will contribute to the production targets.

“Survey findings show that prospects for mineral output growth for 2024 are generally higher than those recorded for 2023. Most of the mining executives (95 percent) are planning to ramp up production in 2024 to compensate for anticipated revenue losses due to prevailing and expected softening mineral prices. Only five percent indicated that production for 2024 will be the same as 2023. Respondent mining executives also indicated that the projected 2024 production targets will be largely supported by ongoing expansion projects. The projections show that mining industry output is expected to grow by a weighted average of approximately 12 percent in 2024. Gold and PGMs are the major growth drivers for the mining industry in 2024.”

He said in line with the projected mineral output growth for 2024 survey findings show that average capacity utilisation is expected to reach 90 percent in 2024 compared to 84 percent in 2023. Prof Makochekanwa said key sectors anticipated to drive improvement in capacity utilisation in 2024 are gold, ferrochrome and coal.

“Survey findings show that on average all mining companies are injecting capital to ramp up and sustain their operations. Analysis of capital requirements by mining companies show that the industry requires around US$2 billion in the next 12 months to ramp up and sustain their operations.”

Chamber of Mines president Mr Thomas Gono said the state of the sector report has emerged to become a prominent evidence-based study that has been useful in assessing the state and prospects for the mining industry.

“Most stakeholders have confirmed that the report is rich in information and that they are using the survey findings in informing their decision making. The mining industry continues to be an important sector in Zimbabwean economy. The Government’s economic blueprint, the National Development Strategy 1 (NDS1), accords the mining industry a central and important role. Working under the guidance of the Ministry of Mines and Mining Development, we remain committed to enhancing the contribution of the mining sector,” said Mr Gono.

Giving feedback to the report, the Minister of Mines and Mining Development Soda Zhemu said it should come up with mechanisms that allow the sector to be able to continue as an important sector of the economy.

“When we have crafted and implemented the necessary strategies, comparison is necessary as to what was predetermined last year as to the actual performance,” he said.

He said the problems of obsolete equipment that is being used in mining operations as stated in the report attract unnecessary costs such as machines that consume a lot of electricity and negatively impact profitability.

The Minister emphasized on the need to look at beneficiation and going up the value chain for all the minerals, as opportunity that those in the industry must ride on.

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