ISLAMABAD: Pakistan has huge reserves of chromite, but outdated mining and processing techniques limit its ability to increase both the volume and value of this exportable mineral to its full potential.
Chromite is a value-added product that is used in the production of ferrochrome, which is the basic component in the manufacturing of stainless steel.
Chromite has a worldwide market demand of $2 billion per annum.
Suleman Akram, a research associate at the Trade Development Authority of Pakistan (TDAP), told WealthPK that Pakistan had significant potential to increase its chromite exports provided cutting-edge technology was applied for mining and processing.
He pointed out that prices of chromite depended on the availability of grades. He added that price of lumpy chromite ranged between Rs7,000-Rs20,000, 38%-48% grade between Rs22,000-Rs50,000, and 50% between Rs60,000-Rs90,000.
Suleman Akram said Lasbela and Bostan Special Economic Zones (SEZs) in Balochistan were the most suitable locations for establishing ferrochrome production plants as these were close to the chromite-producing districts of Kila Saifullah, Pishin, Lasbela and Khuzdar.
He added that as these districts were close to the CPEC routes, finished goods could easily be transported to the steel industry.
He said boost in production of ferrochrome, the main ingredient used in production of stainless steel, could help Pakistan export stainless steel at commercial scale to generate billions of dollars because of the high demand for the product in the world market.
According to the data from International Trade Centre, Pakistan exported $95 million worth of chromite in 2021, including China ($84 million), Japan ($6 million) and Russia ($1 million).
In 2021, Pakistan was among the top five exporters of chromite, with the rest being South Africa, Turkey, Zimbabwe and Kazakhstan.
China, Russia, Indonesia, India and Turkey are the top five importers of chromite.
Data shows that South Africa exported $1.9 billion worth of chromite and China imported $2.3 billion worth of chromite in 2021.
Suleman Akram of TDAP said China was the largest importer of chromite from Pakistan, accounting for 88% of total exports in 2021. He added that Pakistani products could capture more market share if application of the latest technology in chromite mining and processing was ensured.
He said that modern processing units could be established near the quarries to avoid the costs incurred on transportation of the raw mineral to the processing units away from the extraction sites. He said that the chromite processing zones should be designated as tax-free zones to attract both the domestic and foreign investments.
He also called for setting up a separate mining zone with a complete value chain in one location to increase the competitiveness of the products. He maintained that investors would invest where they are sure to get lucrative profits.
He added that proper training should be provided to labourers working in the mining sector to help increase their productivity.
-INP
