Zimbabwe’s miners overcame rising costs and policy concerns to deliver a record 36.48 tonnes of gold in 2024, 21% more than in 2023, beating the industry target of 35 tonnes.
The 2024 gold haul outshines the previous record of 35.6 tonnes set in 2022. The 2024 figure was driven by a 27% increase in deliveries from small-scale miners and an 11.4% growth from larger miners, according to figures just released by Fidelity, the country’s official gold buyer and refiner.
Sales from smaller miners had dipped by 23% last year due to delayed payments from Fidelity. In 2024, faster payments and the removal of VAT on gold sales mid-year encouraged producers to sell more gold to Fidelity.
Large scale miners ramped up output during the year. Dallaglio, the gold arm of Padenga, produced 2,025kg in the nine months to September, up 22% from the same period of 2022. The company is reaping the benefits of the US$86 million it has invested into mining over the past five years. Most of the capital expenditure last year was spent at Pickstone, which is transitioning from an open pit mine to an underground operation to increase production. Caledonia produced 1,610kg up to September and has projected full-year output of around 2,200kg for 2024. Kuvimba Mining House, the country’s biggest producer, said earlier last year that it expected to produce 3,500kg for 2024.
Gold miners had a good year in terms of prices, which rose by 27% in 2024. But despite this and record production, miners say rising costs and hostile economic policy are preventing their operations from reaching their full potential.
Energy costs are their biggest concern, according to a survey by the Chamber of Mines late last year. Miners pay USc14.21/KWh with a peak tariff of around USc19/KWh. During power cuts, they use diesel power, which has an implied tariff of over USc30/kwh. They say the mining industry is losing up to 10% of potential output due to power outages.
Miners get 75% of their export earnings in USD, and the other 25% in ZiG. Because of the local currency’s rapid loss of value, the surrender portion of their earnings is eroded by over 50%. They estimate this is equal to a 12% tax on exporters’ gross proceeds.
