Local cable manufacturer CAFCA Limited has reported steep declines in sales, with reduced mining investment emerging as the biggest drag on performance, Mining Zimbabwe can report.
By Ryan Chigoche
In its trading update for the third quarter ended 30 June 2025, the Zimbabwe Stock Exchange-listed company said mining-related sales volumes fell 62 per cent year on year.
The slump reflects subdued capital spending in the sector as global commodity prices cooled, curbing demand for heavy-duty copper and aluminium cables used in shafts, plants and transmission lines.
The weakness was not confined to mining. Utilities also scaled back, with demand falling 49 per cent as liquidity shortages delayed projects.
Although retail and distribution volumes grew 23 per cent through improved distributor engagement and a revamped factory shop, the rebound was too small to offset sharp losses in mining and utilities.
Overall, sales volumes dropped 14 per cent year on year, while revenue slipped 5 per cent despite a 31 per cent quarter-on-quarter recovery.
Adding to the strain, rising input costs pushed raw material prices higher. Copper rose 15 per cent year to date and aluminium 28 per cent during the reporting period, increases CAFCA had to absorb to protect market share.
While the copper rally benefited producers, it hurt downstream manufacturers who depend on the metal as a key input. In response, CAFCA has accelerated a shift towards aluminium, a cheaper substitute.
Aluminium conductor volumes surged 74 per cent in the first quarter compared to 13 per cent growth for copper, and a new stranding machine was installed to expand capacity in line with global trends in power and construction cabling.
However, aluminium’s lower conductivity limits its application in high-value markets, leaving CAFCA exposed to competition from international rivals with greater research and development capacity.
Domestic policy shifts have added further pressure. Statutory Instrument 157 of 2024 liberalised the cable market, opening the door to imports, including cheap and counterfeit products that eroded margins. At the same time, regional exports remained flat due to liquidity challenges, while U.S. tariffs on metals introduced fresh volatility to supply chains.
CAFCA’s difficulties mirror broader turbulence in the metals industry. Earlier this year, Impala Platinum flagged the possible early closure of its Canadian palladium mines after profits slumped on weak prices.
In Zimbabwe, falling base metal revenues are already dampening mining activity, cutting into CAFCA’s order book even as gold receipts provide some relief.
To contain costs, the company has reduced production shifts from three to two and introduced a new planning model to improve efficiency.
Yet the steep fall in mining-linked orders shows how dependent CAFCA’s fortunes are on commodity cycles and investment trends.
When mining firms scale back spending, suppliers like CAFCA feel the impact almost immediately, a reality starkly underlined in its latest results.
