Namibia expects improvements on 2017 mining recovery
The Namibia Chamber of Mines anticipates further improvements on the progress that has been made so far in the mining space as commodity prices are expected to recover.
“The mining sector in 2017 did recover from the low growth in 2016. We saw an improvement in diamond production and also uranium production by 23% and this was also more as a result of more production coming from Husab Uranium mine.”
“But not only that, we have also seen a huge improvement in commodity prices, Zinc, Copper and Gold and this is largely being driven by demand for renewable energies and also that of electric motor vehicles,” says the chamber of mines’ Lauren Davidson.
Going forward in 2018 the chamber expects to see this improvement to continue largely driven by better commodity prices.
However, it must be kept in mind that some of these revenue improvements might be offset by an increase in the exchange rate, Davidson cautions.
Analysts predicted last year that Zinc prices will continue to rally in their 2018 outlook.
In 2016, Zinc was considered the best-performing LME metal, jumping more than 64 percent in 12 months.
The metal further climbed in 2017 albeit at a slower pace and has gained over 21 percent since January.
“Zinc’s highest point of the year came in October, when it hit a more than decade high of $3,369.50. Supply worries and a strong Chinese demand outlook supported the base metal’s rapid price rally,” says Investing News.
However, on Gold, Bloomberg says prices haven’t had the best year in 2017 when compared to industrial metals, and the outlook for 2018 looks muted at best.
Copper ended 2017 closer to a four-year high of $3.30 a pound, yet there are concerns that up to 40% of global Copper mine supply might be potentially disrupted through labour contract negotiations.
Experts anticipate the prices not to rise that much.are also seeing renewed interest in many exploration projects particularly Lithium. I’m sure we have all heard that there is a new Lithium mine into production. So we are optimistic of things going forward,” says Davidson.
Lithium is a core-component in the manufacturing of battery cells and looking back at 2017, prices remained strong and with the demand for electric vehicles growing market participants are optimistic prices will remain strong.
According to Investing News global lithium-ion battery demand is expected to grow between six and seven times by 2026.
House Mountain Partners and the Disruptive Discoveries Journal’s Chris Berry adjusted the Lithium market growth upwards to 617000 tonnes by 2025 from 550 000 tonnes per year.
However, experts have said demand for Lithium continue to outweigh production and Namibia stands a chance.