• Gold export earnings have resumed an upward trajectory, climbing to $246.87 million in March 2025, a 14% increase
  • The March rebound was driven by a 9% increase in gold output from 2.6 tonnes to 2.8 tonnes
  • Large-scale mining operations continue to grapple with structural constraints, including equipment breakdowns, undercapitalisation, low-grade ore

               

Harare- Gold export earnings have resumed an upward trajectory in March 2025, climbing to $246.87 million, a 14% increase from February’s $216.86 million, marking the first rise since November 2024 when a record $361 million was achieved.

This recovery follows a three-month decline, with earnings dropping to $291.87 million in December, $291.49 million in January, and a low of $216.86 million in February, despite record-high global gold prices.

Local challenges, including leakages and power blackouts, severely disrupted production, undermining the sector’s ability to capitalise on favourable market conditions.

The March rebound, driven by a 9% increase in gold output from 2.6 tonnes to 2.8 tonnes, is largely attributable to artisanal and small-scale miners (ASSM), with the first quarter of 2025 recording a 40% output surge to 8.5 tonnes compared to Q1 2024.

However, large-scale mining operations continue to grapple with structural constraints, while soaring global prices, fueled by geopolitical and economic instability, have amplified export revenues.

The March production surge was predominantly powered by ASSM, which contributed 1.9 tonnes, a 14% month-on-month increase accounting for nearly 68% of total output. In contrast, large-scale miners produced just 928 kg, a marginal uptick from February’s 927 kg.

This disparity reflects ASSM’s agility in overcoming challenges like high-value machinery maintenance, high taxations enabling them to capitalise on high gold prices with fewer capital-intensive constraints than larger operators.

The 40% output growth in Q1 highlights the sector’s reliance on small-scale miners, who have been instrumental in reversing the earnings decline since November’s peak. However, the informal nature of much ASSM activity raises questions about the sustainability of this model, reflecting the need to fully formalise and long-term investment to maintain growth.

Large-scale mining operations have faced persistent challenges that contributed to the earnings slump from December to February. Major players like Caledonia Mining have slashed production targets, revising 2025 forecasts to 74,000–78,000 ounces from over 80,000 ounces in 2022, as they channel $309 million into recapitalising the Bilboes project.

RioZim has been hampered by equipment breakdowns, undercapitalisation, and low-grade ore since 2021, significantly reducing output. Kuvimba Mining House’s efforts to extend mine lifespans have further constrained production.

These issues, exacerbated by local disruptions like power blackouts and leakages, prevented large-scale miners from benefiting from global price surges, ceding market share to ASSM since 2017.

Nevertheless, optimism persists: Kuvimba targets 3,600 kg in FY2025, with its Freda Rebecca mine delivering 2,123 kg in the first 10 months, while Padenga Holdings aims for 100,000 ounces, driven by increased output from its Eureka and Pickstone mines.

International Front

Internationally, gold prices have soared to unprecedented levels, reaching $3,500 per ounce in April 2025 and rising 40% in Q1, with the LBMA (PM) quarterly average hitting $2,860/oz, up 38% year-on-year.

This rally, driven by geopolitical conflicts such as Russia-Ukraine and Israel-Hamas, trade tensions between the US and China, and US tariff threats, has reinforced gold’s safe-haven status.

A weakening US dollar and volatile stock markets have further fuelled demand.

Global gold supply grew modestly by 1% year-on-year to 1,206 tonnes in Q1 2025, with mine production reaching a first-quarter record of 856 tonnes.

However, recycling declined by 1% as consumers held onto gold, anticipating further price gains. Demand trends show sustained interest from institutional and high-net-worth investors, though over-the-counter (OTC) investment weakened due to a shift toward exchange-traded funds (ETFs) and negative stock changes, reflecting evolving investor preferences in a high-price environment.

The tightening supply-demand balance, coupled with declining recycling, suggests that gold prices could climb further if geopolitical and economic uncertainties persist, providing continued support for export revenues.

Gold’s bullish outlook hinges on ongoing geopolitical and economic volatility, likely to sustain high prices.

At home, policymakers and industry stakeholders must prioritise recapitalizing large-scale operations and formalizing ASSM to maximize revenue and ensure sustainability.

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