MARKETS HIT

Artisanal gold trade, prices slump over coronavirus

Dealers fear virus may lead the world economy into a recession, plunging the prices further.

In Summary

• Miners have kept off mines in Migori, Siaya and Narok counties for fear of contracting the virus and in line with government measures to curb the disease. 

• Gold prices have reduced from about Sh4,500 per gram to a low of Sh3,200 for the same quantity. 

Women at one of the gold mines in Nyatike
ARTISANS: Women at one of the gold mines in Nyatike
Image: FILE

Artisanal gold miners have begun to feel the effects of the coronavirus as prices have nosedived and production reduced.  

Miners have kept off mines in Migori, Siaya and Narok counties for fear of contracting the virus and in line with government measures to curb the disease. 

Gold prices have reduced from about Sh4,500 per gram to a low of Sh3,200 for the same quantity. 

 

Simon Odoyo, chairman of the Lolgorien Local Miners Association in Narok, said they are now selling gold for between Sh3,400 and Sh3,500 per gram, down from Sh4,000.

“We have been hard hit in the gold mines as buyers and dealers have reduced or stopped buying gold over uncertainty,” Odoyo told the Star on the phone.

At Komito mines in Migori the number of miners has reduced from over 200 to only 20 when the Star visited on Saturday.

Ezekiel Otieno, the chairman of Komito Miners Association, said the cost of supplies like mercury has shot from Sh15,000 per kilo to Sh20,000 hence minimising profits.

“When countries like Italy and Europe went on lockdown and flights were stopped, we knew it was coming down on us,” Otieno said.

At Bondo subcounty in Siaya, the prices have reduced from Sh3,600 per gram to between Sh3,000 and 3,100.

The Uyawi Gold Mining Cooperatives Society chairman Odhiambo Odari said the sector is bracing for tougher times.

 

“Nobody wants to buy gold anymore as economic uncertainty over the coronavirus scare has seen dealers keep off for fear of losing their money. Dubai which has been the main market of Kenyan gold is now inaccessible,” Odari said.

 Migori gold trader Felix Okwanyo said most buyers budget to buy at least five grams of gold from miners before selling to dealers.  

“We first have to ascertain that dealers will get the gold before we buy from miners but we are now afraid of making huge purchases,” he said.

Okwanyo said the coronavirus may lead the world economy into a recession, plunging the prices further.

“When gold prices dip and the sector is disrupted some towns will shrink. From bars, hotels, chemists and even MPesa shops, we are all feeling the heat,” Okwanyo said.

(edited by o. owino)