{"id":132981,"date":"2019-03-12T18:47:56","date_gmt":"2019-03-12T16:47:56","guid":{"rendered":"http:\/\/www.myza.co.za\/beneficiation-is-touted-as-a-silver-bullet-why-it-might-not-be-the-conversation\/"},"modified":"2019-03-12T18:47:56","modified_gmt":"2019-03-12T16:47:56","slug":"beneficiation-is-touted-as-a-silver-bullet-why-it-might-not-be-the-conversation","status":"publish","type":"post","link":"https:\/\/www.myza.co.za\/press\/beneficiation-is-touted-as-a-silver-bullet-why-it-might-not-be-the-conversation\/","title":{"rendered":"Beneficiation is touted as a silver bullet. Why it might not be | The Conversation"},"content":{"rendered":"

Beneficiation is touted as a silver bullet. Why it might not be<\/a>: <\/p>\n

The beneficiation of diamonds has brought great benefits to Botswana. <\/span> Shutterstock<\/span><\/span><\/figcaption><\/figure>\n

Like other mineral producing countries, South Africa has considered implementing beneficiation policies to stimulate development. Beneficiation entails the transformation of a mineral (or a combination of minerals) to a higher value product. It\u2019s therefore about the downstream processing of a mineral product \u2013 all the way from a raw mineral (such as iron ore) to final products (like a car).<\/p>\n

The logic behind beneficiation is that raw minerals don\u2019t, on their own, have high value added. Exporting them unprocessed means that they don\u2019t contribute that much to the economy. The idea of beneficiation is to capture more value from minerals by processing them locally before exporting them. <\/p>\n

There are lots of examples of beneficiation policies across the world. Indonesia restricted and considered banning the export of certain unprocessed minerals. For its part, China implemented policies to force the downstream processing of rare earth elements \u2013 essential raw materials for a range of products including magnets, catalysts, alloys and glass. In southern Africa, made De Beers mining licence dependent on diamonds being cut and polished in the country. <\/p>\n

Many other countries, including the Philippines, Zimbabwe and South Africa, have all considered policies like this at one stage or another. <\/p>\n

But is beneficiation the panacea that it\u2019s made out to be? Is beneficiation a good industrial policy?<\/p>\n

Some recent studies have cast doubt on using beneficiation policies to drive industrialisation. They argue that countries should rather develop the industries that support the mining industry. The argument is that this might be easier to achieve and more sustainable because local demand for these products already exists. <\/p>\n

We argue that beneficiation should be viewed within the context of a country\u2019s larger industrial policy strategy. To do this, we analyse value chains in their entirety \u2013 from ore to final products. In our research on steel in South Africa, we posed the question: if we consider the steel value chain in its entirety \u2013 from iron ore to sophisticated final products such as aeroplanes \u2013 which parts of the value chain should South Africa support to gain the best developmental outcomes? <\/p>\n

Our research casts further doubt on the wisdom of doggedly following a strict beneficiation approach without considering the other options for development available to mineral producing countries.<\/p>\n

Rethinking beneficiation<\/h2>\n

Our research involved working out the strategic value of different products in the value chain and how difficult it would likely be to successfully export these products competitively given the current capabilities \u2013 such as skills and infrastructure \u2013 South Africa has.<\/p>\n

We did this using two metrics:<\/p>\n