Chinese-built steel plant in Zimbabwe fires up its furnace as it 'builds the nation'

A new US$1.5 billion Chinese-built iron and steel plant in Zimbabwe has fired up its blast furnace as it begins production of pig iron, a major raw material needed to make steel.

There are high hopes that the Mvuma steel plant could see Zimbabwe become one of Africa's largest producers of iron and steel products.

"Today marks a monumental milestone as our cast iron machine produces its very first batch of pig iron," Dinson Iron and Steel Company (Disco), the Zimbabwean subsidiary of Chinese steel giant Tsingshan Holding Group, said on June 13

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Pig iron, also known as crude iron, is produced by smelting iron ore in a blast furnace. From July, the Chinese firm also aims to start making steel billets, an intermediate form of steel. Eventually it will make other products, too, such as pipes, bolts and nuts, smaller slags, rolled tubes, fences, shafts, wires and bars.

The plant will initially produce 600,000 tonnes of steel a year at the peak of its first phase and production is expected to reach five million tonnes in the final phase of the plant expansion. It will have up to 3,000 workers during the first phase of production with the number expected to double in the second phase.

When running at full throttle, the processing plant around 200km (120 miles) south of the capital Harare is touted to become Africa's biggest integrated steelworks. And it could not come soon enough.

After years of economic mismanagement, especially during the leadership of former president Robert Mugabe when the country's biggest steel plant was mothballed, Zimbabwe is now pinning its hopes on the revival of its iron and steel industry.

The Chinese embassy hailed the start of operations at the new plant, posting on X, formerly Twitter, that "it marked a significant step for Zimbabwe's industrialisation and modernisation".

Smoke is seen as production begins at Tsingshan's Dinson Iron and Steel Company production plant in Manhize village near Mvuma, Zimbabwe. Photo: Reuters alt=Smoke is seen as production begins at Tsingshan's Dinson Iron and Steel Company production plant in Manhize village near Mvuma, Zimbabwe. Photo: Reuters>

In future, the plant will make use of Zimbabwe's abundant iron ore, chrome, coal, nickel and limestone to make iron and steel products that will help develop the country's value chain. Raw materials will be mined and processed locally, government officials have said, with enough reserves to last 100 years.

Zimbabwe is rich in natural resources to help lift it out of its economic crisis, including gold, diamonds, nickel, ferroalloys, coke, coal briquettes, chromium ore, tobacco and raw cotton.

Tsingshan, the world's biggest stainless steel producer, also has other projects in Zimbabwe, including a ferrochrome smelting factory owned by subsidiary Afrochine Smelting in Selous, a village in Mashonaland West province, around 70km west of Harare.

Ferrochrome is an intermediate product used as feed material in the production of value-added materials such as stainless steel. Ferrochrome produced at Selous will be used to make steel at the Mvuma plant.

Tsingshan has also invested in coal for coke processing in the Hwange area of Matabeleland North province. Coking coal will come from the Dinson Colliery in Hwange.

When Zimbabwe President Emmerson Mnangagwa toured the construction site in March, he said there was a shift taking place as the nation moved from being an importer of steel to an exporter.

"It's pleasing that our iron ore will be fully explored and value-added locally. We would buy iron from South Africa and Kenya and now we will export to them," Mnangagwa said.

"This iron ore was always there lying idle; we did not know. We would wonder why certain rocks are heavy and we would even build our foundations for houses with iron ore. We are now using iron ore to help us build our nation."

Last year, Disco signed a deal with the landlocked African nation on the construction and refurbishment of a 1,000km-long railway line so that the company's products could be transported to Beira, Mozambique, on the east coast of Africa, for export.

"Once we start production, we will be moving a lot of exports and in large quantities to different parts of the world," the steel producer said.

"Our project will see the construction of Gweru-Mvuma rail, refurbishment of existing infrastructure (we'll manufacture rail slippers ourselves) and a line to reach the Indian Ocean in Mozambique carrying value-added products. Regional players are excited."

Dosman Mangisi, chief operations officer at the Zimbabwe Institute of Foundries, termed the start of operations as "a shot in the arm" for Zimbabwe's iron and steel industry.

"It's a dream come true to the economy of Zimbabwe," Mangisi said.

He said it will improve the ease of doing business in the country within the metal foundries industry due to availability of raw materials. That will have the effect of boosting downstream and upstream sectors of the Zimbabwe economy.

"This is the moment the country should enhance the retooling of the strategic sector of iron and steel and foundries for metal castings, both domestic use and export," Mangisi said.

Many existing processing, or beneficiation, plants in Zimbabwe and other African countries, were built decades ago by European investors and are now outdated.

Mangisi welcomed investments worth millions of dollars from China, saying: " China has become an Asian ambassador in Africa. This new milestone increases confidence in African economies.

"The advent of the Chinese, who have come with efficient technologies, has brought a great change in the beneficiation of minerals in African economies."

Zimbabwe has struggled to shake off the economic problems stemming from Mugabe's time in power. It has been more than two decades since the US and some European countries imposed strict sanctions on the country in response to Mugabe's human rights abuses and the controversial forced and often violent seizure of land from white farmers.

But China has continued to bankroll major projects in the country, including hydropower dams and airports such as Robert Gabriel Mugabe International Airport in Harare and Victoria Falls International Airport. Chinese firm Shanghai Construction Group built a US$140 million parliament funded by China as "a gift to the people of Zimbabwe".

Zimbabwe has also emerged as a major source of lithium, an essential raw material for the batteries that power electric vehicles.

Chinese companies, including Zhejiang Huayou Cobalt, Sinomine Resource Group, Chengxin Lithium Group, have invested millions of dollars in the acquisition of lithium mines and more than US$1 billion into building processing plants.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2024 South China Morning Post Publishers Ltd. All rights reserved.

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