University of the Witwatersrand (Wits) School of Mining Engineering mineral economist Professor Hudson Mtegha says one of the key areas where South Africa can maximise its potential for economic growth is the beneficiation of extracted minerals.
He explains in a statement that this rings true for the rest of Africa too, with there being many opportunities in the mining industry to reinvigorate economic growth.
However, there are challenges standing in the way of Africa’s success in this regard, including power supply and skills shortages, which will need to be addressed first.
“While the South African mining industry has emerged relatively unscathed, the pandemic has highlighted the need to build a stronger economy that is resilient in the face of future threats.
“Historically, exports of extracted minerals have been predominantly with low levels of value addition – we have allowed Africa’s mineral wealth to be stripped and shipped, without maximising direct benefit to the countries.
“If we as a continent beneficiated our own raw materials, growth would emanate through a number of avenues, including industrialisation, which would result in greater returns,” says Mtegha.
Beneficiation is the process of improving or adding economic value to extracted raw materials, transforming them into higher-value products, which can then be consumed locally or exported.
The process itself is energy intensive, and requires a consistent supply of low-cost energy to be effective. This presents the largest barrier to local beneficiation in South Africa – and the rest of the continent.
The African Union 'Infrastructure Outlook 2040' report suggests that energy demand in Africa is expected to increase at a rate of 5.1% a year through to 2040.
“This implies that generation must increase by 6% a year to keep up. In the meantime, the continent will continue to rely on fossil fuels for some time, growing at a rate of only 3.7% a year. It is imperative that we focus our efforts on securing a clean, environmentally stable and predictable supply of energy,” notes Mtegha.
While wind and solar-based energy production are suitable for general power purposes, they may be insufficient for powering beneficiation, since they rely on external factors.
Nuclear energy could provide a more viable option, provided local policies are put in place to facilitate a closed nuclear fuel cycle in the future, to ensure the energy produced is renewable and sustainable.
“Russian State nuclear entity Rosatom, for example, has outlined a long-term strategy that builds up to 2050, which involves moving to inherently safe nuclear plants, using fast reactors with a closed fuel cycle.
"The ultimate aim of the closed fuel cycle is to eliminate the production of radioactive waste from power generation. Africa should take this timeline into account as we build out new policies,” highlights Mtegha.
He adds that promoting local beneficiation across the continent would have a direct, positive impact on economies. Local beneficiation would create more jobs, foster industrialisation as new industries grow to supply inputs from these activities and result in an overall diversification of the economies.
However, large-scale local beneficiation will not happen overnight. African countries will have to begin by taking small, practical steps towards building an economic environment that is conducive to local beneficiation.
“We need to begin by undertaking mineral value-chain analyses to identify opportunities and costs along the various stages of production, account for the existence of potential local and regional markets for beneficiated products, and emphasise industrial policies that focus on removing constraints, including skills, finance, energy, transport, water and legislation,” Mtegha points out.
He explains that mining, in itself, is not a sustainable sector, since deposits deplete with time, while at the same time compromising the environment. Beneficiation on the other hand, which is technology driven, is the key to continued growth across the continent.
“It would allow us to process lower-quality deposits, for example, thereby extending the lives of the industry. Once competencies are developed, the industry can be linked to global chains by processing from other jurisdictions or indeed benefit from intellectual property developed for use elsewhere,” Mtegha says.