By Nelson Gahadza, Senior Business Reporter
Zimbabwe’s mining sector is showcasing remarkable resilience, maintaining strong performance despite fluctuating commodity prices. This growth is primarily fueled by foreign investments and strategic initiatives aimed at enhancing the sector’s capacity. Analysts suggest that the mining industry remains an attractive investment opportunity, bolstered by a series of positive developments.
Investment Surge and Licensing Growth
According to the Zimbabwe Investment and Development Agency (ZIDA), the mining sector has seen a significant uptick in activity, with 280 licenses granted in the past year, up from 277 the previous year. This increase reflects a growing interest in mining ventures, underscoring the sector’s potential for expansion.
In the first quarter of 2025, foreign cash investments in mining reached an impressive US$651.18 million, a substantial rise from US$434.54 million in the preceding quarter. Additionally, ZIDA reported US$211.09 million in capital equipment imports and US$43.25 million in foreign currency loans, indicating robust financial support for mining operations.
Commodity Performance: Gold Shines Bright
The IH Securities 2025 Mining Sector Report highlights the mixed performance of global commodity markets, particularly for platinum group metals (PGMs), lithium, and base metals. However, gold has emerged as a standout performer, reinforcing its status as Zimbabwe’s largest foreign currency earner. The report notes that gold prices surged to record levels, reaching approximately US$3,673 per ounce in early September, incentivizing producers to expand operations and formalize their market deliveries.
Deliveries to Fidelity Gold Refinery saw a remarkable increase, rising from 20,679 kg in 2024 to 28,497.8 kg in 2025—a 37.8% growth. This surge in gold production is expected to continue, with output projected to rise from 38,454 kg in 2024 to 43,390 kg in 2025.
Challenges for PGMs and Future Projections
While gold thrives, the outlook for PGMs appears less favorable. The report anticipates a decline in platinum, palladium, and rhodium outputs in 2025 due to falling international prices. Specifically, output for platinum and palladium is projected to decrease to 17,539.60 kg and 14,244.33 kg, respectively, down from 18,910.90 kg and 15,603.22 kg in 2024.
Analyst Walter Mapfumo emphasizes the need for consistent and predictable policies to sustain the sector’s growth. He points out that high operational costs, particularly in energy and transportation, must be addressed to enhance competitiveness.
Strategic Investments and Capacity Expansion
Several companies are actively investing in new capacities and alternative energy sources. Karo Platinum, for instance, is advancing its Chegutu project, raising US$165 million for Phase 1 through gold by-product streaming. This project, located on the Great Dyke, aims to produce 226,000 ounces of PGMs annually, positioning it as Zimbabwe’s third-largest producer.
Zimplats has also made significant strides, completing a US$398 million smelter expansion project that triples its capacity to 380,000 tonnes of concentrate annually. These investments are crucial for bolstering Zimbabwe’s mining output and enhancing its global competitiveness.
Coal and Diamond Production Trends
Coal production is on a recovery trajectory, with total output expected to reach approximately 6.3 million tonnes in 2025, up from 5.7 million tonnes in 2024. This growth is driven by various projects, including Hwange Colliery’s US$17 million maintenance investment and Zambezi Gas Investments’ new coke oven facility.
Conversely, diamond export volumes have plummeted by 60% in the first half of 2025, falling to 2.72 million carats from 6.85 million carats in the same period in 2024. Despite this decline, diamond production is projected to grow by 7% in 2025, supported by expansion efforts from companies like ZCDC and Anjin Investments.
The Future of Lithium and Market Dynamics
Lithium, once considered Zimbabwe’s future growth engine, has faced significant price declines, dropping below US$10,000 per tonne in early 2025. However, recent months have seen modest recoveries as supply rationalization meets renewed demand from China.
Market research indicates that the platinum market will remain in a structural deficit in 2025, benefiting Zimbabwean producers with firmer pricing. Despite volatility, overall export earnings from PGMs are expected to remain supportive.
Conclusion: A Promising Path Ahead
Zimbabwe’s mining sector is poised for growth, driven by favorable market conditions and strategic investments. However, sustaining this momentum will require ongoing policy support, addressing operational challenges, and fostering an environment conducive to investment. As the sector navigates the complexities of global commodity markets, its resilience and adaptability will be crucial in shaping Zimbabwe’s economic future.
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