Zimbabwe’s gold deliveries down 15% in 2023

Zimbabwe’s gold deliveries down 15% in 2023

Zimbabwe’s gold deliveries fell by 15% in 2023, as the industry felt the impact of rising costs, power shortages and government’s policy on the currency.

Deliveries to official gold buyer Fidelity ended the year at 30.1 tonnes, down from 35.6 tonnes in 2022. 

The 2022 haul was a record, driven by new mining projects at larger producers and better payments to small-scale miners, who account for the bulk of Zimbabwe’s gold deliveries. But sales slowed in 2023.

Gold output has plateaued for large producers. They delivered 11.4 tonnes, showing little growth from the 11.2 tonnes, the same amount of gold they delivered in 2021. 

Small-scale producers delivered just 18.6 tonnes in 2023, a sharp drop of 23% from the 24.1 tonnes they sold in 2022. Deliveries from small miners are now back where they were in 2021.

The drop in sales is due to rising costs, payment delays by Fidelity, and a decision by the government in the last quarter to pay all miners 75% of their deliveries in USD. Previously, small-scale producers were getting 100%. 

After the change, the impact on sales was immediate. Gold deliveries fell from 3.701 tonnes in October to 1.488 tonnes in November. Deliveries from small-scale producers fell from 2.642 tonnes to just 552 kgs in November, the lowest for the year.

Miners expect output to grow in 2024, but are pessimistic about their prospects for the year due to costs, weak commodity prices, and the government’s policy of paying miners 25% of their earnings in Zimbabwe dollars. Power costs surged after ZESA increased tariffs from US12.21 cents/kWh to US14.21 cents/kWh.

“The mining industry will probably deal with similar issues in 2024, particularly in the first half,” says Chamber of Mines CEO Isaac Kwesu, who described 2023 as one the most difficult in years for miners.

For large-scale producers, growth is expected from projects such as Dallaglio, which is expanding underground operations at Pickstone Mines and increasing production at Eureka Mine. 

Caledonia Mining projects its gold production at between 75 000 and 80 000 ounces in 2023 and 2024, while Freda Rebecca, the largest producer, expects to increase output.- NewZWire



No comments yet. Why don’t you start the discussion?

Leave a Reply

Your email address will not be published. Required fields are marked *