Zimbabwe platinum producers are set to benefit from increased world demand for the metal, coming at a time other countries are reducing production due to different challenges, according to the World Platinum Investment Council (WPIC) report.
WPIC noted that global refined platinum production experienced an 8 percent decline year-on-year, totaling 1,178 koz, as gains from Russia failed to offset decreases from South Africa.
Zimbabwe’s platinum production rose 2 percent in the second quarter of 2023 to a record 126 000 ounces, according to the report.
In the second quarter of 2022, the southern African country’s platinum output stood at 124 000 ounces.
“Zimbabwe supply edged 2 percent higher year-on-year to 126 koz, its highest since the fourth quarter of 2021. This was the result of higher output from Zimplats as additional milled ore volumes from the commissioning of a concentrator were realised,” WPIC stated.
“The operation also benefited from a Zambian power import agreement, mitigating the impact of national loadshedding that effected other producers in the country.”
The country’s platinum output jumped 9 percent from 116koz in the first quarter of 2023 to 126koz in the second quarter of 2023.
For the first six months of 2023, platinum production increased by negligible 1 percent to 242koz from 241Koz.
“Despite the headwinds of loadshedding across the Zimbabwean national grid, mine production is expected to hit an all-time high of 502 koz in 2023, a 5 percent year-on-year increase. This growth reflects the expansion of capacity at Zimplats,” reads the report.
“However, it is important to note that since Zimbabwean-mined platinum undergoes downstream processing in South Africa, the overall outcome is contingent upon the performance of that country.”
The southern African country has the world’s second-largest platinum group metals resource, after South Africa, on the Great Dyke. It has three platinum-producing mines: Zimplats, Mimosa and Unki.
Zimbabwe’s platinum production surpassed 2022 estimates but fell by a negligible 1 percent compared to 485 000 ounces in 2021.
Authorities have also been encouraging foreign investment in the mining industry to boost production and generate much-needed forex revenue for the country.
The platinum group metals (PGMs) industry is among the minerals expected to contribute to Zimbabwe’s target to grow the mining sector to $12 billion by the end of the current year.
In the period, South African platinum output fell by 14 percent to 759 000 ounces owing to ongoing processing constraints that limited refined production.
According to WIPC, there were a number of market developments during the first quarter of 2023 that in aggregate had a significant impact on market balances and provided read-throughs to the outlook for the year as a whole.
“Starting with supply, mine supply was significantly curtailed in South Africa by the worsening electricity shortage there. This led to increased work-in-progress concentrate at the major producers, the unwinding of which is uncertain from a timing perspective as utilising excess smelting capacity is dependent upon the availability of electricity,” the report reads.