THE Zimbabwean government has imposed tight control on chrome trade and directed that all purchases of the ore be coordinated by the Minerals Marketing Corporation of Zimbabwe (MMCZ).
Before the policy change announced by Information minister Monica Mutsvangwa during Tuesday’s post-cabinet briefing, Chinese companies, mostly in the Midlands province, would simply venture into rural areas like Mberengwa, Mvuma, Shurugwi and Zvishavane and buy the chrome ore from desperate small-scale miners at prices as low as US$20 per tonne — about six times less than the actual market value.
While announcing the policy change, Mutsvangwa said it was meant to help the country attain a US$12 billion mining industry by 2023.
“Cabinet received and adopted Sundry Updates of the Mining Sector as presented by the Minister of Mines and Mining Development, Honourable Wiston Chitando.”
“The public is advised that Cabinet agreed to a policy change whereby all chrome ores will be traded through the Minerals Marketing Corporation of Zimbabwe (MMCZ).”
“The MMCZ, through a Chrome Ores Coordination Committee, will set quarterly prices of chrome ore which miners and traders will trade at. The Committee will comprise representatives of Smelters and the Chrome Small-Scale Miners’ Association,” she said.
The Chinese companies which were culprits in mopping up chrome ore before smelting it and shipping the processed product to the Asian country took advantage of the absence of stiff competition in the mining sector to exploit the small-scale miners with no means to find lucrative buyers.
Wellington Takavarasha, the Zimbabwe Miners’ Federation chief executive officer, told The NewsHawks that the policy change in the chrome sector was commendable as it would rein in the errant Chinese companies.
“If this is fully implemented, the chrome price will be commensurate to the economic fundamentals. The Chinese were buying the chrome at ridiculous prices and people were not benefiting. It was now like an issue of ransom because the Chinese were buying the chrome for as little as US$20 or US$30 per tonne when the international market is about US$120.”
“The process of making one a buyer was such that you would simply fill forms and then you go and start buying chrome. So the Chinese were abusing this system. Now that MMCZ will be coordinating the price through a set committee, people digging up the ores will start to be treated fairly,” he said.
Zimbabwe Institute of Foundries chief operations officer Dosman Mangisi said the policy change will boost the chrome sector because more small-scale miners had begun pulling out owing to the low prices that were being determined by the Chinese.
“The cost of raw chrome at the domestic price had become a huge concern for miners. It was in fact affecting efforts of beneficiation, leading to low exports of ferrochrome,” he said.