Mining ZimbabweLatest Mining News, Policy and Industry Updates

Zimbabwe’s platinum industry is set for growth in 2025, with production expected to rise despite a sluggish recovery in global metal prices, Mining Zimbabwe can report.

By Ryan Chigoche

According to the Chamber of Mines, platinum output is projected to reach 19.6 tonnes, up from 18.9 tonnes in 2024, while palladium production is set to increase by 3% to 16 tonnes. Major producers, including Zimplats, Mimosa, and Unki Mines, are expected to maintain full-capacity operations, ensuring a steady supply even amid challenging market conditions.

Driving this growth are significant investments aimed at sustaining and enhancing production. Zimplats is leading the way with a US$190 million investment to refurbish its Base Metal Refinery (BMR) and complete several projects between 2025 and 2028. This initiative is expected to strengthen local refining capacity and improve long-term profitability.

Meanwhile, Mimosa Mining Company is allocating US$2.1 million toward developing tailings storage facilities, extending the mine’s operational lifespan.

Unki Mines is also focusing on expansion and sustainability, investing US$500,000 in open-pit mining and US$200,000 in solar energy projects, which are projected to increase production by 1%.

However, despite these investments, the sector continues to face financial pressures due to weak metal prices.

While some companies anticipate a price rebound, cash flow constraints have forced them to put large expansion projects on hold. Nonetheless, the commitment to ongoing development reflects confidence in the long-term viability of Zimbabwe’s platinum industry.

Market analysts predict a continued weak recovery in PGM prices in 2025, with platinum expected to average $965 per ounce, up slightly from $955 per ounce in 2024. Palladium prices are forecasted to average $985 per ounce, compared to $970 per ounce the previous year. This sluggish price movement is largely attributed to an oversupply of PGMs and declining demand, particularly from the automotive sector, which has traditionally been a key consumer.

Adding to the uncertainty are global concerns about the long-term demand for PGMs as the world accelerates its shift toward renewable energy. While platinum has been considered a substitute for palladium in autocatalysts, the narrowing price gap between the two metals has limited its impact on overall demand. This trend raises further questions about the future role of PGMs in industrial applications.

Despite these market challenges, Zimbabwe’s platinum sector remains resilient. Steady production growth and strategic investments are positioning the industry for long-term stability. While weak prices may slow down large-scale expansions, ongoing development projects and the country’s abundant platinum reserves provide a strong foundation for sustained growth in the years ahead.

London Stock Exchange-listed mining and exploration junior Premier African Minerals Limited has reached a further amendment to its Offtake and Prepayment Agreement with Canmax Technologies Co., Ltd concerning the Zulu Lithium and Tantalum Project, Mining Zimbabwe can report.

By Rudairo Mapuranga

The amendment, which revises the Long Stop Date, solidifies Canmax’s commitment to working alongside Premier in the project’s development.

Key Amendments and Conditions

Under the amended agreement, the Long Stop Date has been extended from April 1, 2025, to either December 31, 2025, or until Premier secures a reputable buyer approved by Canmax to settle the Prepayment Amount plus interest. The adjustment is contingent upon several conditions:

1. Canmax’s Participation Rights – Canmax retains the right to receive partial repayment through new ordinary shares in Premier, ensuring it holds 13.38% of the company’s shares on a fully diluted basis post-funding.

2. Financial Oversight – Canmax will monitor and control Premier and Zulu Lithium’s operational financial activities, including trade creditor budgets, until the full settlement of the Prepayment Amount plus interest.

3. Insolvency Safeguards – Neither Premier nor Zulu Lithium should be subject to insolvency proceedings unless contested and resolved within 30 days.

4. Asset Security – Premier cannot pledge or encumber its assets, including mineral rights, without prior written approval from Canmax.

5. Expression of Interest Requirement – A non-binding letter of interest from a reputable buyer acceptable to Canmax must be secured within 30 days of signing the addendum. Should the initial interest be withdrawn, Premier will have an additional 30 days to secure an alternative buyer.

6. Board Commitment – Premier’s directors must personally commit to these conditions until full settlement of the Prepayment Amount plus interest.

Failure to meet these conditions allows Canmax to exercise its full rights under the amended agreement.

Premier’s Default and Increased Interest Rate

This amendment follows Premier’s default on the initial offtake agreement, where the company failed to deliver the minimum 1,000 tonnes of lithium spodumene per month in November and December 2023. As a result, Canmax invoked its rights under the agreement, carrying forward a US$3 million balance ($1.5 million per month) and increasing the interest rate to 12% per annum, effective December 1, 2023.

Premier CEO George Roach acknowledged Canmax’s continued support despite the defaults, stating that Premier remains committed to meeting its delivery obligations. The company aims to resume production by late February, contingent on contractor commitments.

Background of the Prepayment Agreement

The relationship between Premier and Canmax dates back to an August 3, 2022, agreement in which Canmax pre-purchased US$34.64 million worth of lithium spodumene concentrate. This prepayment was intended to fund the construction and commissioning of the Zulu plant.

Under the agreement:

• Canmax was to receive 25% of Premier’s gross sale proceeds from lithium shipments until May 30, 2024.

• From June 1, 2024, until full repayment, Canmax would receive 50% of Premier’s gross sale proceeds.

• Premier was required to begin repaying the Advance Purchase Amount no later than November 1, 2023, at a rate of 1,000 tonnes per month.

If Premier failed to deliver the minimum tonnage, it had to compensate Canmax through cash payments. Failure to make two consecutive deliveries would increase the interest rate further to 10%, and a prolonged failure could lead to Canmax converting the outstanding balance into Premier shares or even claiming a direct interest in Zulu Lithium based on a US$200 million valuation.

Zimbabwe’s ferrochrome production is set for a major boost as two key players, Zimasco Mining Company and Afrochine Smelting Company, ramp up investments in mine expansion and smelting capacity. These strategic initiatives are expected to ensure a steady supply of mineral resources and drive increased output, according to the Chamber of Mines Commodity Outlook 2025.

By Rudairo Mapuranga

Afrochine Smelting Company plans to invest US$22.6 million in mine exploration to sustain ferrochrome production and feed its expanding smelting operations. The company is also investing in two new smelters, expected to be completed by October 2025, which will help maintain steady production levels in a globally competitive market.

Zimasco Mining Company, on the other hand, is investing approximately US$3 million in expanding its mining operations. Additionally, Zimasco is committing US$43,243 to the 19M01 Ngezi 3D 24 underground project, which is expected to be completed by 2026 and is anticipated to boost ferrochrome production by 28%.

These investments align with Zimbabwe’s drive to increase ferrochrome exports, leveraging the country’s vast chromite reserves to meet rising global demand for stainless steel production.

Zimbabwe’s mining sector is forecasted to grow by 7% in 2025, despite a challenging global economic environment characterized by sluggish growth, trade disruptions, and declining commodity prices.

According to the Chamber of Mines Commodity Outlook 2025, Zimbabwe’s mineral revenue is projected to rise from US$5.9 billion in 2024 to US$6.2 billion in 2025. While the gold sector is expected to be the primary driver of this growth, ferrochrome expansion projects by Zimasco and Afrochine will also play a pivotal role.

The mining industry still faces significant risks, including:

• Power supply challenges affecting consistent production.
• Foreign exchange shortages limiting access to capital.
• High operational costs, including electricity tariffs and fiscal charges.

Globally, commodity markets are expected to be bearish in 2025, with the World Bank Commodity Price Index projected to drop 5%, driven by weaker demand from China and an oversupply of platinum, palladium, and nickel. However, Zimbabwe’s focus on ferrochrome expansion and its efforts to attract foreign investment are expected to counterbalance these global pressures.

With sustained investment in production capacity, Zimbabwe’s ferrochrome sector is poised to strengthen its position in global markets. The government’s US$12 billion mining industry roadmap includes a strong focus on value addition, and the expansion projects by Zimasco and Afrochine will contribute significantly to this vision.

As Zimbabwe works to maximize its mineral potential, the expansion of the ferrochrome sector will enhance export earnings and ensure that the country remains a key supplier in the global stainless steel industry.