“When the cargo arrived in China and the sealed containers were opened, they found concrete cement bricks inside rather than drums containing the Coltan mineral,” David Bensusan, Chief Executive of Mineral Supply Africa (MSA) told The New Times last week.
MSA and another mineral export firm, Trading Services Logistics (TSL) are victims of the latest wave of mysterious thefts of Rwandan minerals at the port of Dar es Salaam, in Tanzania.
In an interview at his office last Thursday, Bensusan said he lost one container with 24 tonnes of Coltan worth about US$1million (Rwf730million), meant to be delivered to a buyer in China.
A source with TSL, said by phone, yesterday, that they lost two containers, each with at least 12 tonnes of Coltan, both, worth over US$1million destined for customers in Japan and Belgium.
In all cases, the containers arrived well, and were received by their respective buyers; however, on opening, they were found to be containing bogus material, to be specific, bricks. No one knows where, when and how the minerals were replaced with bricks; it remains a mystery.
Both MSA and TSL received news of their misfortune at sea, about eight days ago, on Saturday last week just as officials from the Dar es Salaam Port were leaving Kigali after a three day promotional tour in Rwanda.
An international alert has since been issued, by the Tantalum-Niobium International Study Centre (TIC) warning its members to be on the lookout for the stolen Rwandan minerals.
TIC is an international association with a membership of over 90 firms worldwide involved in aspects of mineral processing and supply and its alert was published last week by an online publication, ‘Metal Pages’ which focuses on news in the mining industry.
“Industry participants are being asked to promptly inform TIC if they encounter or see difficulties with similar shipments from Dar es Salaam or are offered Coltan at below the prevailing market prices by unknown traders or suppliers,” read the alert.
Who’s stealing Rwandan minerals?
The theft, last month, of Rwandan minerals is not the first and probably not the last, a prospect that has left the 240 members of the Rwanda Mining Association (RMA) worried.
Jean-Malic Kalima is RMA president. Speaking last week, from his office in Kigali, he told The New Times that his members want the government to work closely with its Tanzanian counterparts to find the culprits behind the thefts and stop them.
“Who is stealing our minerals? We want to know and stop them,” said Kalima.
No one knows the culprits, at the moment but there is consensus among RMA members that all previous thefts have taken place at the Port of Dar es Salaam and they want Tanzanian authorities to take responsibility and put an end to the practice.
The theft, last month, follows another case, four months ago, of two containers stolen in June, this year.
In a letter dated June 19, 2015, a copy of which The New Times has, RMA wrote to the Ministry of Trade and Industry informing the Minister about the theft of two containers belonging to TSL that were destined for buyers in Japan and China.
The container headed to Japan, according to the letter, contained ten tonnes of Coltan and was marked as shipment number TSL/RW/0000125; it was worth over US$457000.
Meanwhile the second container headed to China contained 15 tonnes of Coltan worth over US$633,000 and was marked as shipment number TSL/RW/0000132. Both buyers in Japan and China found concrete bricks on opening their respective packages.
In April 2014, MSA also lost another container with minerals worth over Rwf540 million; in all incidents, the minerals were never recovered.
The stolen mineral exports are shipped in Maersk containers and in October last year, Rwanda’s Minister of East African Community, Valentine Rugwabiza met the firm’s Group Executive, Senior Vice President Lars Reno Jakobsen to address the mysterious thefts.
“Our people are losing millions of dollars in theft at the port of Dar es Salaam, especially goods in the Maersk containers; I wish to know how we can solve this problem,” Minister Rugwabiza asked Jakobsen, then, putting him on the spot for solution.
In response, Jakobsen pledged that his firm would do anything in its power to upgrade the tracking system to the level of the product inside the container; instead of only tracking the container.
Rwanda demands investigation
The latest thefts have left MSA’s Bensusan a worried man because he has three containers still on the waters enroute to Asia; “It’s possible they could be laden with the bogus weight of bricks not minerals.”
Bensusan also has another two containers awaiting shipment at the port of Dar es Salaam; on Friday, he flagged off another container from Kigali to the Dar es Salaam; the three containers are to be shipped off this week.
Ten days ago, Paul Wallace, chief executive of Tanzania International Container Terminal Services (TICTS) led a delegation to Rwanda on what was described as a ‘promotional tour’ during which they would meet and interact with Rwanda’s business community.
However, the real reason for the visit was for TICTS, which handles 80 per cent of the traffic at Dar port, to face members of the Rwandan private sector who had plenty of issues they needed resolved.
The Rwanda government through its embassy in Tanzania played a behind the curtains role in getting the port delegation to visit Kigali during which they interacted with Rwanda’s private sector at a business lunch.
Safety at the port was high on the agenda with the June theft of TSL containers providing the case in point on the occasion.
“We must resolve this issue once and for all and I believe an investigation at the port can help us establish the source of the problem,” a tough speaking Minister Rugwabiza said during the TICTs business lunch in Kigali.
In response, TICTS CEO Paul Wallace welcomed the investigation and assured the Minister that Rwandan authorities would receive their full support to help collectively put an end to the thefts.
Also in attendance was an official of the Rwanda National Police who was part of efforts to investigate previous thefts; he called for full cooperation from the Tanzanian government authorities if the thefts are to be stamped out.
But of immediate concern to RMA members is how to thwart the negative effects of the thefts to the mining sector; association president Kalima described the situation as ‘double jeopardy’ for Rwanda’s mining sector.
“The sector is getting a beating from two fronts; the global market prices for minerals have declined in recent months and now we have safety challenges that make us unattractive to buyers overseas,” observed Kalima.
Here’s what he means; previously, it would cost Rwanda’s mineral exporters between US$3500 and US$4000 to ship a container from Kigali but the risks have pushed that cost sky-high.
“We are now paying US$9000 for a container; this could sour with the latest spate of robberies,” said MSA’s Bensusan whose company exported over 50 percent of Rwandan minerals, in 2014.
The new costs are on account of extra safety precautions put in place to protect the minerals from theft, including private armed guards and sophisticated tracking technology.
But to MSA’s Bensusan, there’s no problem between Kigali and Rusumo; the real challenge is on the Tanzanian side, to be specific, at the port.
“We have pictorial evidence that the stolen minerals were intact when they arrived at the port,” Bensusan told The New Times last week and shared some of the pictures taken after the cargo had arrived at Dar.
As would be expected, all the stolen minerals had been insured by their exporters and after a few months of haggling and carrying out own investigations, the insurance firms will compensate both TSL and MSA.
“The challenge is that after they have paid, they won’t accept to underwrite any more of our cargo because the risk of being stolen, to them, will be almost certain,” said Kalima.
But there’s another problem- the buyers. Previously, they would place a firm order for the supplies and pay up to 90 percent of the value of the material, upfront with the balance payable on delivery of the commodity.
However, both Bensusan and Kalima said buyers are now demanding that they pay 100 percent of the value after safe delivery of the minerals.
“That will hurt our cash flows because it means we have to foot all costs relating to sourcing, processing and supplying of the minerals, we are already limping,” Bensusan said.
But Rwanda needs its mining sector up and running not limping because until tourism took over recently, mining was the country’s leading earner of foreign exchange and it also directly and indirectly employs hundreds of thousands of Rwandans, including women in rural areas.
Rwanda contributes close to 30 percent of the global Coltan trade, a mineral used in electronic engineering for mobile phones and video-game consoles.
Before the global commodity price depression set it, Rwanda was projecting to earn up to US$400 million this year, up, from approximately $150 million in 2013.
On Thursday last week, the mining sector’s leadership and select government officials met to discuss a way forward on the matter.
This week is poised to be a busy one as they engage their Tanzanian counterparts for a solution, before the country goes to polls to elect a new president.