Miners cutback production to counter exchange rate disparities

Harare – #Zimbabwe’s value of gold exports has sharply been coming off since September triggered by inflation and low retention of export receipts driving side marketing and lower production, analysis by Equity Axis shows.

Equity Axis is an online financial media service platform focused on African markets offering real time stock quotes, news, analysis and data.

The research show that the value of gold exports sharply plunged from $130 million exported in September to $72 million and $47 million in successive months of October and November respectively.

Comparatively, gold exports increased in the closing months of 2017, with a value of $110 recorded in November, 2017.

The shortage of foreign currency affected production, with large scale-miners struggling to acquire large machinery and latest technology required to boost production.

The distortions between the USD/Bond or RTGS exchange rate contributed to the rising inflation which negatively affected the mining industry among other sectors in terms of both retention and accessing raw materials.

In response to the foreign currency challenges and unfavorable payment methods by the government, some gold producers reportedly resorted to under-declaring their output, while small scale miners resorted may have resorted to side marketing selling in a bid to salvage value.

Small-scale miners who are the major contributors of gold deliveries to government owned, Fidelity Printers and Refiners (FPR) bemoaned the shortage of fuel and called upon the government to act decisively to avert the situation which negatively impacted production.

Small-scale miners accounted for 21,7 tonnes of the record 33,2 tonnes gold delivered to FPR in 2018.

-Equity Axis News

Equity- Axis

Equity Axis is an online financial media service platform focused on African markets offering real-time stock quotes, news, analysis and data.

Leave a Reply

Your email address will not be published.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

This site uses Akismet to reduce spam. Learn how your comment data is processed.