Namibia's mining environment remains favourable

27 July 2021 | Economics

Simonis Storm (SS); "The mining environment remains favourable and the re-opening of the Kombat mine will turn the sector"s performance around.

Windhoek ∙ [email protected]

Diamond, zinc and uranium production were the main drivers of mining output for the month of May 2021.

According to the Namibia Statistics Agency (NSA), the mining composite index increased by 19.4% in May 2021 on a monthly basis, better-off than a marginally growth rate of 0.8% recorded in the preceding month. Annually, the index recorded a negative growth rate of 1.6%.

The diamond production index recorded an increase of 13.8% for May 2021 month-on-month compared to a growth of 8.6% recorded in the previous month. On an annual basis, diamond production increased by 3.7% in May 2021.

The volume of diamonds produced stood at 118 131 carats. Whereas in April 2021, the production stood at 103 780 carats, while 113 881 carats were produced in May 2020.

The monthly increase registered in the production of diamond carats was mainly driven by high global demand, hence more production of carats produced during the period under review, NSA pointed out.

In addition, the zinc production index registered on a monthly basis an increase of 29.0% in May 2021, compared to a growth of 1.8% recorded in the preceding month. On annual basis, zinc production recorded a growth rate of 23.2%.

During the period under review, 7 555 tons of zinc concentrate and contained were produced compared to 5 857 tons and 6 131 tons produced in April 2021 and May 2020, respectively.

Furthermore, the uranium production index increased on a monthly basis by 65.2% during the period under review, from a declined growth rate of 25.9% posted in the preceding month. On annual basis, uranium recorded a growth of 16.5% in May 2021.

The production of uranium stood at 630 tons compared to 382 tons and 541 tons produced in April 2021 and May 2020, respectively, NSA said.

Gold

Lastly, the gold bullion production index recorded a decline of 10.8% for May 2021, month-on-month. This is worse-off when compared to an increase of 14.3% recorded in the preceding month.

In annual terms, gold bullion production declined, registering a negative growth rate of 38.5%, from a positive growth rate of 19.5% recorded in May 2021.

The production of gold bullion stood at 351 kg in May 2021 compared to 393 kg and 571 kg for April 2021 and May 2020, respectively. The decline recorded on monthly basis in the production of gold bullion was attributed to low grade ore mined, NSA said.

According to Simonis Storm (SS), the mining environment remains favourable and the re-opening of the Kombat mine planned for the end of 2021 together with the commissioning of the new diamond mining vessel during the first half of 2022 will turn the sector’s performance around.

However, due to its capital-intensive nature, it won’t make much of a dent in the unemployment rate, SS said.


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