Zimbabwe Mining Report

Providing expert analysis, independent forecasts and competitive intelligence on the mining.

Report includes: BMI Industry View, Industry SWOT Analysis, Industry Forecasts, BMI's Petrochemicals Risk Reward Index, Economic Forecasts, Company Profiles and Global, Regional and Country Industry Overviews.

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Zimbabwe Mining Report
Product Price
$1,295.00

BMI View: Zimbabwe's mining industry will grow steadily in absolute terms over our forecast period through to 2019 as production increases across the key platinum and diamond mining sub-sectors. However, we note a number of potential downside risks on the horizon, including falling mineral prices and an uncertain political and regulatory climate.

Zimbabwe Mining Industry Value
2013e 2014e 2015f 2016f 2017f 2018f 2019f
e/f = BMI estimate/forecast. Source: UN Data, BMI
Mining Industry Value, USDbn 1.18 1.15 1.14 1.18 1.25 1.30 1.33
Mining Industry Value, USDbn, % y-o-y -1.38 -3.17 -0.60 3.33 6.02 3.93 2.60

Latest Developments & Structural Trends

  • Zimbabwe is richly endowed with deposits of chrome, gold, nickel, diamonds and platinum, among other minerals. Its gold reserves are among the largest in Africa, while it has the world's second-largest platinum reserves. Diamond reserves are measured to be the second-largest globally after Russia. Development in these key markets together with a gradual more stable political and economic climate has seen the country's status as major global producers strengthen in recent years. In terms of overall output, Zimbabwe is challenging the world's largest platinum producers, Russian and South Africa, while a recent reduction in taxes for smaller gold miners will see production rise at almost a double-digit rate this year.

  • The mining sector will nevertheless face increasing challenges to its current growth trend, however. Political and economic risk remains a particular concern from both a regulatory and investment point of view and the election victory of ZANU-PF will continue to spell trouble for the future of the industry.

  • The one clear positive for the sector going forward is the recent clearance granted by the Kimberley Process which will allow the countries to restart diamond exports once the issue of conflict minerals from the Marange fields had been addressed. The deposit is estimated to be the largest diamond discovery in the world in more than a century. Against this backdrop, we forecast the country's diamond output to average annual growth of 4.5% during 2016-2019, with output reaching 13.6mnct carats by 2019, up from 12.0mnct in 2016.

  • Zimbabwe is posed to challenge Russia and South Africa as the world's leading platinum producer over the coming years as new investment by both existing and new players allows the country to capitalize on its considerable reserves, which are the second largest in the world. Coincidentally, the country will see its status lifted by slowing production growth in neighbouring South Africa, where serious difficulties as a consequence of labour unrest and high energy costs will mean that the world's largest platinum producer will experience major difficulties in maintaining production levels.

  • We forecast output growth to expand by 4.5% annually during 2016-2019, with output growing from 0.61mn ounces (moz) in 2016 to 0.68moz by 2019. Despite this growth trend, Zimbabwe will remain a relatively minor gold producer on a regional level, with the majority of production continuing to come from artisanal and small-scale producers. At present, the country is significantly behind Africa's largest gold producers, South Africa, Ghana and the DRC in terms of its total output.

BMI Industry View
7
SWOT
9
Industry Forecast
11
Platinum: Zimbabwe To Become Major Force
11
Refinery Decision Finally Made
14
Table: Zimbabwe - Major Platinum Projects
14
Political Risks Weigh Heavily On Sector
14
Table: Platinum Production (Zimbabwe 2014-2019)
15
Gold: Smaller Miners To Boost Production
15
Table: Key Gold Projects In Zimbabwe
18
Table: Gold Production Forecast (Zimbabwe 2014-2019)
18
Diamonds: Significant Growth Potential, Despite Unfavourable Environment
18
Table: Diamond Production (Zimbabwe 2014-2019)
20
Industry Risk Reward Ratings
21
Zimbabwe - Risk/Reward Index
21
Rewards
21
Industry Rewards
21
Country Rewards
21
Risks
21
Industry Risks
21
Country Risks
21
Africa: Headwinds To Slow Growth
22
Key Takeaways:
22
Latest Revisions:
23
Table: Africa - Mining Risk/Reward Index
24
Regulatory Development
25
Regulatory Underperformance
25
Beneficiation Drive
25
Structure, Law & Royalties
26
Volatile Political Climate
27
Table: Africa: Mining Regulatory Outlook
27
Commodities Forecast
29
Global - Metals: Lower Costs And Weak Demand To Anchor Prices
29
Metal Price Weakness: Chinese Equity Slump & US Dollar Strength
30
US Dollar Strength To Anchor Weak Metal Prices
31
Competitive Landscape
33
Table: Southern Africa - Largest Listed Mining Companies
34
Company Profile
35
African Consolidated Resources
35
Global Company Strategy - Impala Platinum - Q4 2015
37
Table: Impala Platinum - Key Financial Data
41
Regional Overview
42
Africa Mining: The Four Key Themes
42
Key Themes
42
SSA Gold: Stagnation, But DRC To Shine Bright
42
Iron Ore Price Weakness To Curb Growth
43
Regulatory Uncertainty To Curb Growth
44
Mining To Remain Key Contributor To GDP
45
Global Industry Overview
47
Global Mining: 2015 Key Themes Revisited
47
Table: Key Mining Themes For 2015
47
Theme: Mining Capital Expenditure Will Continue To Decline
47
Theme: US Dollar Strength
48
Iron Ore Consolidation & Majors Share To Increase
49
Asian Investment In Africa To Continue
50
2015's Standouts
51
Methodology
53
Industry Forecast Methodology
53
Sources
54
Risk/Reward Index Methodology
55
Table: Weighting Of Indicators
56

The Zimbabwe Mining Report has been researched at source and features BMI Research's mining and commodity forecasts for metals, minerals and gems, covering all major indicators including reserves, production, exports and values. The report also analyses trends and prospects, national and multinational companies and changes in the regulatory environment.

BMI's Zimbabwe Mining Report provides industry strategists, service companies, company analysts and consultants, government departments, trade associations and regulatory bodies with BMI's independent forecasts and competitive intelligence on the mining industry in Zimbabwe.

Key Benefits

  • Use BMI's independent industry forecasts on Zimbabwe to test other views - a key input for successful budgeting and planning in this mining market.
  • Target business opportunities and risks in Zimbabwe's mining sector through our reviews of latest mining industry trends, regulatory changes and major deals, projects and investments in Zimbabwe.
  • Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. KPIs and latest activity), Key Projects Tables and Competitive Landscape Tables.

Coverage

BMI Industry View

Summary of BMI’s key forecasts and industry analysis, covering mining reserves, supply, demand and prices, plus analysis of landmark company developments and key changes in the regulatory environment.

Industry SWOT analysis

Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the mining sector and within the broader political, economic and business environment.

BMI Industry Forecasts

Historic data series (2009-2013) and forecasts to end-2019 for key industry and economic indicators, supported by explicit assumptions, plus analysis of key risks to the main forecasts. Indicators include:

  • Mining industry: Industry size (USDmn), real growth (%), % of GDP, employment (‘000), workforce as % of total workforce, average wage (USD).
  • Output: Production volumes (‘000 tonnes, carats etc.) for all major metals, minerals, ores and gems mined in each state, including bauxite, copper, gold, coal, lead, silver, tin, titanium, uranium, zinc etc.
  • Exports: Value of exports (USDmn) for all major metals, minerals, ores and gems mined in each state.
  • Commodity markets: Global demand, supply, stocks and benchmark prices (USD) for aluminium, copper, lead, nickel, tin, zinc, gold and steel.

BMI’s Mining Risk Reward Index

BMI’s Risk Reward Indices provide investors (mining companies and support service providers) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors, with each position explained.

Competitive Landscape Tables & Analysis

Comparative company analyses and tables detailing USD sales, % share of total sales, number of employees, year established, market cap/NAV, ownership structure, production and % market share.

Key Projects

Details and analysis of all current and planned developments (new ventures, capacity expansion and other investments) across the sector broken down by metal/ore.

Company Profiles*

Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.

Sources

The Mining reports are based on an extensive network of primary sources, such as multilateral organisations (UN, WB, IMF), national chambers of commerce and industry, national statistical offices, government ministries and central banks, and multinational companies.

*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.