Mozambique: Q1 ruby export revenue falls by 80% YoY

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Mozambique: Q1 ruby export revenue falls by 80% YoY

11:56 CAT | 02 Aug 2024

Mozambique’s ruby exports fell by 80% in the first quarter, bringing in around $5.2 million, according to data from the central bank to which Lusa had access on Friday.

In its report on the balance of payments for the first quarter, the Bank of Mozambique says that revenues from ruby exports fell from $25.6 million (€23.7 million) from January to March 2023 to $5.2 million (€4.6 million) in the same period this year.

The report associates the “low production levels of the largest producer of this mineral” with “breakdowns in production equipment” and “military instability in the north of the country”, in a reference to attacks by rebel groups in Cabo Delgado, with a strong increase in the first three months of the year.

In May, Lusa reported that ruby production in Mozambique had fallen by 55% in the first quarter, year-on-year, to 252,600 carats due to problems at the country’s largest mine.

The Ministry of Economy and Finance’s budget execution report for January to March reads, “It shows a poor performance, down by 8% compared to the annual plan and a decrease in production of around 55% compared to the same period last year. ‘

Overall ruby production in Mozambique had already fallen to 2.7 million carats in 2023, compared to 4.2 million carats in 2022 and five million carats in 2021.

In the first three months of 2024, production fell to 252,665 carats of rubies, compared to 567,463 carats in the same period of 2023.

Since 2012, ruby mining at MRM’s mine in Cabo Delgado, in northern Mozambique, the country’s largest, has brought in almost a billion euros, according to figures released at the end of April by Gemfields, which owns 75% of the company.

According to data up to December from the “G Factor for Natural Resources” report, which aims to promote “transparency” about the level of wealth from human resources shared by Gemfields “with the governments of host countries” from the mining, oil, gas, timber and fishing sectors, Montepuez Rubi Mining (MRM) had a total revenue of $151.3 million (€141 million) in 2023.

Since Gemfields acquired 75% of MRM in February 2012, the year mining began, with ruby auctions starting two years later – the mine has accumulated revenues of over $1.055 billion (€982.7 million), paying the Mozambican state $257.4 million (€239.7 million) in the same period.

Last year, MRM paid the Mozambican state $53.2 million (€49.6 million) in royalties and taxes, according to the same report.

MRM is a Mozambican company that operates in the Montepuez ruby deposit, located in the north-east of Mozambique, in the province of Cabo Delgado, covering approximately 33,600 hectares.

“It is believed to be the most significant ruby deposit recently discovered in the world,” says the company, which says it has created more than 1,500 jobs locally, 95% of which are for Mozambicans, with 65% coming from Cabo Delgado.

MRM is 75% owned by Gemfields and 25% by Mwiriti Limitada, a Mozambican company.

Source: Lusa