In June, Diário Económico (DE) reported—citing the annual Balance of Payments report published on the website of the Bank of Mozambique (BdM)—that in 2024, ruby sales dropped by 9.8 billion meticais (USD 153 million).
Aiming to understand the reasons behind this sharp decline and to explore current challenges in the sector, DE contacted Montepuez Ruby Mining (MRM), the main ruby mining company in the country.
MRM began by clarifying that the figures released by the Bank of Mozambique (BdM)—pointing to a drop of USD 153 million (9.8 billion meticais) in ruby exports between 2023 and 2024—do not reflect only MRM’s performance but rather the broader context of the industry. “The data includes statistics from various formal operators and ignores the impact of illegal extraction and exportation, which are not officially reported,” the company explained.
MRM attributed its revenue decline in 2024 to a reduction in the production of high-quality stones, decreased international demand, worsening illegal mining, and insecurity in Cabo Delgado. These difficulties were compounded by an unstable geopolitical environment and violent demonstrations following the general elections in October of last year.
Impact of Post-Election Unrest and Insecurity
MRM stated that between December 24 and 26, 2024, “it was forced to temporarily suspend its mining operations due to the deteriorating security situation in Cabo Delgado.” Around 500 workers—including contractors and security personnel—remained at the facilities during this period, which coincided with heightened social instability after the elections.
“Although there were no direct attacks on the company’s concession, surrounding communities were severely affected by acts of vandalism and clashes, which indirectly impacted local well-being and created a climate of insecurity around mining operations,” said MRM.
In addition, organized illegal mining groups intensified their activity within MRM’s concession area, invading protected zones, threatening workers, and looting gemstones. These rubies are often smuggled out of the country and sold on the black market at lower prices than those obtained through official channels—undermining MRM’s international auctions and reducing tax revenues for the state.
Auction Performance and International Market Challenges
The company highlighted that the revenue decline is strongly linked to the scarcity of premium-quality rubies, which—despite being smaller in volume—account for most of the value obtained at auctions. “This situation was worsened by reduced demand in key markets, particularly China, where consumers faced internal economic constraints and geopolitical uncertainty affecting the luxury goods trade,” it noted.
Although the number of auctions was maintained, the price per carat fell, negatively impacting revenue. MRM also pointed out that the global gemstone market is still in a fragile recovery phase.
Investments in Modernization and Increased Capacity
Despite the difficult context, MRM said it is accelerating strategic investments to expand production capacity and better process different ruby categories. A second processing plant (PP2) is nearing completion and is expected to begin operations later this year. “This new facility will increase capacity from 200 to 600 tons per hour, enabling the clearance of existing stock, the production of various ruby types, and exploration of untapped areas within the concession,” the company added.
MRM believes this investment will strengthen its position in the international market and boost its contribution to state revenue through the payment of taxes, fees, and royalties.
Legal Reforms and Combating Smuggling
The company advocates for stronger government action in regulating the sector and cracking down on illegal ruby trade. In this regard, it supports ongoing proposals under the revision of the Mining Law, including the criminalization of raw ruby exports by entities without legally recognized concessions.
According to the company, “it is essential to ensure that natural resources bring real benefits to the population, which requires effective control of the production and marketing chain.”
MRM also emphasized the importance of social stability and community engagement in mining areas, suggesting that the state intensify local development investments as a way to reduce conflict and create a more favorable environment for sustainable investment.
Text by: Nário Sixpene
