Investment in value addition and rise in demand in the international market have catalyzed turnaround of the country’s mineral sector.
Mineral prices on the international market started picking late last year, and the trend has continued into the past three months, signaling a bullish outlook for the rest of the year.
Latest figures from the National Bank of Rwanda indicate that mineral revenues grew by 36.4 percent in 2022, outpacing coffee and tea at 34.1 percent and 10.3 percent respectively.
Although the sector suffered headwinds in the past three years as Covid-19 pandemic-induced instability swung prices in all directions, the mineral sector shows signs recovery.
Rwanda earned close to $800million in receipts in 2022, becoming the country’s largest foreign exchange earner, compared with just over $400million earned in 2019, meaning the sector has surpassed the pre-pandemic revenues.
“The increase of revenues from minerals was mainly driven by improving external demand, combined with government policies to increase value addition in the mining sector” the central bank said.
Last year, export earnings from cassiterite, coltan and wolfram increased by 50.7 percent, 51.3 percent and 7.8 percent respectively driven by the rise in prices and volumes.
While the unit prices of cassiterite, coltan and wolfram rose by 6.2 percent, 21.3 percent and 3.5 percent respectively, and their respective exported quantities increased by 41.9 percent, 24.7 percent and 4.2 percent.
As factories in China, Europe and other markets that absorb Rwanda’s minerals go back to full operation capacity following prolonged Covid-19 disruption, the country’s mineral sector has also continued to recover.
“We have seen prices for Coltan and Cassiterite beginning to pick up again in the past few months, and investors are continuing to come into the sector, we are optimistic that the sector will grow further,” said Frank Butera, executive secretary of the Rwanda Miners Association.
The past few years saw increased investments into the country’s mining sector, improving productivity from mines, and the value addition.
The volumes of the country’s minerals grew to 18, 658 tons in 2022 from the 7,343 tons recorded in 2019, according to the Rwanda Mines, Petroleum and Gas Board.