Revenues from mineral exports this year are expected to hit a four-year low as a result of price fluctuations on the international market.

Last year saw the country fetch $228 million from 8,100 tonnes of mineral exports.

Trade and Industry minister Francois Kanimba, on Tuesday, told The New Times that the international price of cassetirite (tin) and coltan, Rwanda’s main mineral exports, dropped by 40 per cent, implying that recovering the earlier projected $285 million in their trade this year is "out of question.”

"However, the good news is that this problem is cyclical and not permanent; so our targets for the long term remain intact,” Kanimba said.

He added that the poor prices have discouraged some companies, leading to decreased production capacity.

To avert this problem, government intends to increase support to artisanal miners (small-scale miners), who Minister Kanimba said contribute 60 per cent of total exports, as well as attract large scale investors to purchase concessions that are exploited below their capacity.

"Artisanal miners are the most affected when prices fall yet they contribute the most. The government will increase support to them through their cooperatives, so that they continue to produce even in challenging times,” Kanimba said.

"We also need to attract worthy investors who look at long term production. The mining law is almost ready and soon enough, the sector will be regularised and concession licences will be given to potential investors.” 

Price fluctuation has disrupted mine concessions, a case in point being Gatumba Mines, located in Ngororero District, which closed down in April this year due to, among other things, poor prices for minerals.

Investors worry

The $12 million concession, which sits on 22,000 hectares of land and employed more than 1,200 labour force, temporarily suspended operations due to loss-making, according to its management.

"With reduced challenges the concession can mine up to 100 tonnes of cassetirite and coltan in a month, and we would earn $345,000 a month totaling to $4.1 million a year,” CP Passano, the managing director of Gatumba Mining Concession, said.

"However, with numerous challenges including illegal mining and unprofitable trade, the mine could not realise its full potential. 

"Let me make it clear that the mine has not closed down completely; we have just suspended operations as we try to find a lasting solution to the problems that have defined our worst mining experiences.”

In January last year, government began to revise the Mines and Quarries Exploitation law to ensure maximum return to government by attracting long term investors.

However, the law remains in the pipeline, and according to sources from the Ministry of Natural Resources, many existing concession licenses are yet to be renewed.

The mining law provides three types of licenses, including; a prospecting license of two years, an exploration license of up to eight years and a mining license up to 30 years.

The government maintains a target of collecting $400 million from mineral exports by 2017.