Mining ZimbabweLatest Mining News, Policy and Industry Updates

The Zimbabwe Republic Police (ZRP) Bulilimamangwe, Matabeleland South is investigating a case of murder where a 37-year-old artisanal miner was allegedly killed by his younger brother (23) following an argument to share gold proceeds.

Rudairo Mapuranga

According to ZRP, the Victim Khaliphile Ndlovu died after he was hit with stones on the head by his brother Coster Ndlovu together with Coster’s 24-year-old friend Jonathan Moyo at Gossan Mine in Mphoengs.

“Police in Mphoengs are investigating a case of murder which occurred on 31/07/22 at Gossan Mine.

“The victim, Khaliphile Ndlovu (37) died after he was hit with stones on the head by his brother Coster Ndlovu (23) as well as his friend Jonathan Moyo (24) following an argument over sharing of gold proceeds,” the police said.

Reports of violence in the artisanal mining sector have been on a decline following the commencement of operation “No to Machete gangs” which was introduced by the police in 2019 following a series of murders around the small-scale mining community.

A 2019 report by the Zimbabwe Peace Project stated that at least 105 people were murdered all in a space of three months in Zimbabwe’s violence-prone mining areas of Kadoma and other neighbouring districts.

Zimbabwe’s widespread and lucrative artisanal mining which back then was controlled by machete-wielding criminals was a death sentence to many with mobs often caught up in machete wars that often turned fatal. Ordinary citizens were also caught in the crossfire or in some instances, they were direct targets of the gangs.

The Police since January this year have arrested 29887 people under operations no to machete gangs, the operation is meant to restore sanity in the artisanal and small-scale mining (ASM) sector.

Illegal Miners are mostly a target of machete gangs who have been causing havoc in the ASM sector.

According to Police spokesperson Asst-Comm Paul Nyathi, the operation is ongoing and they have covered all the provinces.

Machete-wielding criminals are notorious for pounding on small-scale and artisanal miners stealing their gold or gold ore and smuggling processed gold to neighbouring countries like South Africa and Botswana through the country’s porous borders.

The police restored order in mining areas after taking the machete gangs head-on, arresting large numbers of people and thwarting a wave of violence that threatened to disturb gold mining and consequently deliveries to Fidelity Gold Refinery (FGR).

The Zimbabwe Miners Federation (ZMF) has called on miners to formalize their operations by adhering to the dictates of the law to avoid a situation where work is constantly being disrupted by law enforcement agents.

Under its quest to see the Artisanal and Small Scale (ASM) sector contributing an annual revenue of US$4 billion to the US$12 Billion 2023 mining vision.

According to ZMF President Ms Henrietta Rushwaya, the Federation has a zero-tolerance mantra of no to illegal mining.  She said that the organisation’s offices are open for everyone to come and get investment advice.

“As small-scale miners, we are saying it is a crime to mine illegally in the country. And we are saying zero tolerance to illegal mining. We should be seen as being associated with constructive and proper mining, constructive in the sense that our mining should be guided by principles as stated in the mines and minerals act.  People are advised and allowed to come to our ZMF offices to find out how best they can be linked with proper mining houses and how best they get tributes from other registered miners,” Madam Rushwaya said.

The world’s biggest miners have spent the past two weeks reporting lower profits, shrinking dividends and a worsening outlook as the year rolls on.

While commodities like iron-ore and copper have retreated as gloom settles over the global economy, Glencore is enjoying two key advantages over its mining rivals – a powerful trading business that thrives in volatile markets, and a suite of coal mines now churning out previously unimaginable earnings thanks to the global energy crunch.

As a result, analysts are forecasting record profits and returns when Glencore reports on Thursday, with first-half earnings seen more than doubling from a year ago.

It’s a sharp reversal from previous years. The company had lagged its biggest rivals, largely because it doesn’t mine any iron ore, a commodity that helped supercharge earnings for mega miners BHP Group and Rio Tinto Group. But China’s Covid controls have sapped demand for the steelmaking ingredient as investor worries about a global recession weigh on commodity prices more broadly.

Rio Tinto last week reported a sharp decline in first-half profit and cut its dividend in half, while Anglo American announced lower earnings and shareholder returns. Other miners from Vale to Lundin Mining also disappointed.

For now, the companies are still making good money, if not at last year’s record levels. It was Anglo’s second-best first half on record, while Rio paid its second-biggest interim dividend. But the increasingly uncertain outlook and weakening prices have cast a shadow over the underlying numbers, particularly as relentlessly rising costs across the industry add to profit-margin pressures.

“Prices have sharply declined from first-half averages, so these reported results do not reflect the reality of the markets today,” said Christopher LaFemina, an analyst at Jefferies Group. “We are in a stage of the cycle during which prices are falling and costs are still rising. Not a good combination.”

Against this backdrop, Glencore is expected to deliver its best-ever results. The company has already said that its trading profit will exceed the top end of its guidance range, after it cashed in on volatile markets.

But it’s coal — the dirtiest fuel — that is seen as the really big earner.

Prices have soared to records this year as a global energy crisis boosts demand for fossil fuels around the world. Utilities are curbing imports from Russia due to the war in Ukraine, tightening the amount of available supply, while surging natural gas prices are also increasing demand for coal.

That’s put Glencore in a position to return cash to shareholders on a scale that was previously the reserve of the iron-ore majors, with some analysts forecasting payouts could exceed $10-billion in total this year.

The current dividend policy is to pay $1-billion from its trading unit, plus 25% of free cash flows from the sprawling mining business.

Still, some of those expectations — at least for the half year — have been tempered after Glencore flagged that its profitable bets on volatile commodity markets have tied up more working capital than normal.

“The underlying result will be very strong, and when markets return to lower volatility this working capital will be released making it a temporary impact,” said Tyler Broda, an analyst at RBC Capital Markets. “For now, however, this could temper the cash returns expected at the half-year results.”

Mining weekly

After successfully selling 1500 gold coins in the first week of trading, the Reserve Bank of Zimbabwe (RBZ) has reported that it will release an additional 2000 Mosi Oa Tunya gold coins this week as the demand for the coins accelerates.

Rudairo Mapuranga

In an effort to curb inflation and to save the local currency from collapse the central bank last month introduced gold coins which are sellable in both local and foreign currency. The Bank said the gold coins have proven to be a real deal factor in combating inflation and the collapse of the Zim dollar.

The gold coins were sold at an initial price of US$1 823, 80 per coin or $805 745,35 using the willing-buyer willing-seller rate through agents who include Aurex Zimbabwe, Homelink and all commercial banks.

According to RBZ, 85 per cent of gold coins were sold in the local Zimbabwean dollar while the remaining 15 per cent were sold in foreign currency, with the uptake proving that the coins can be a stable store of value.

“The MPC resolved to maintain the interest rates at current levels. The tight monetary policy stance would be buttressed by the favourable uptake of gold coins which were introduced into the economy on 25 July 2022 as an alternative stable financial product for store of value.

“A total of 1500 gold coins were sold by the Bank’s agents during the first week of their release into the market, with 85% having been bought in local currency and the balance of 15% in foreign currency. An additional 2000 gold coins will be released into the market during the week commencing 1 August 2022,” RBZ said.

The Reserve Bank said that month-on-month inflation declined from 30,7 per cent in June to 25,6 per cent in July 2022. It also noted that whilst monthly inflation is expected to continue to decelerate during the outlook period, annual inflation will continue to increase up to September 2022 as a result of the lower base effect in 2021.

“The Monetary Policy Committee (MPC) of the Reserve Bank of Zimbabwe (the Bank) met on 29 July 2022 to review the impact of the recent monetary policy measures on the economy. With month-on-month inflation having declined from 30.7% in June 2022 to 25.6% in July 2022, the MPC noted that the progressive decline will continue in the outlook period as a result of the tight monetary policy stance being pursued by the Bank. The MPC also noted that the disinflation trend will be reinforced by measures the government was taking to deal with factors that destabilise the foreign exchange market, particularly by reviewing the basis and framework for payments to its suppliers of goods and services in its quest to stabilise the foreign exchange market and enhance value for money. The MPC further noted that whilst monthly inflation is expected to continue to decelerate during the outlook period, annual inflation will continue to increase up to September 2022 as a result of the lower base effect in 2021,” reads RBZ Press Statement.