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The world’s leading legal tender bullion gold coin, the Krugerrand, this year celebrates its 50th anniversary, marking a critical milestone in South Africa’s beneficiation of its precious metals since gold was first discovered on a Transvaal farm, Langlaagte, on the Witwatersrand in 1886.
The Krugerrand is the most widely held and actively traded bullion coin in the world. It was developed as a gold investment coin and its face value is denominated in ounces of pure gold.
“The Krugerrand has come a long way, and actually tells a beautiful story about South Africa’s endeavours to add more value to its precious metals for the export markets,” says Richard Collocott, Executive Head of Marketing at Rand Refinery, the sole supplier of bullion Krugerrands to primary distributors in South Africa and internationally.
“Since its launch in 1967, more than 53 million ounces of gold have been sold in the form of Krugerrands. Legitimately so, the Krugerrand has been credited as being the trailblazer in the gold bullion coin industry.”
The Krugerrand was the first gold coin in the world to be denominated in ounces of pure gold. It was first only produced as a 1oz gold coin. Recognising an opportunity in the market, fractionals of a ½oz, ¼oz and 1/10oz were added in 1980. Krugerrands are 22 carat coins, containing 11/12 24 carat gold and 1/12 copper. As a traditional alloy used in gold coins that serve as currency, copper hardens the coins, enhancing their durability and strength.
“The success of the Krugerrand shows it is possible to add value to our precious metals if we develop local capabilities and channel resources towards achieving these goals. It will take time and huge investment but it is something worth pursuing,” says Praveen Baijnath, the Chief Executive of Rand Refinery.
In the early days of South Africa’s gold mining, the crude bullion produced had to be shipped to London for refining. The concept of a local refinery had been considered for several years but only in 1920 were concrete steps taken with the launch of Rand Refinery. Now the largest integrated single-site precious metals refining and smelting complex in the world, Rand Refinery has since 1920 refined nearly 50 000 tons of gold – almost a third of all the gold mined worldwide. The Krugerrand, which it manufactures in partnership with the South African Mint, is one of the most precious products it’s ever produced.
As part of its socio-economic upliftment and sustainable development initiatives, Rand Refinery has established three key projects that seek to benefit communities: the Gold Zone, Intsika Skills Beneficiation Project and Ekurhuleni Jewellery Project.
The Gold Zone, located within Rand Refinery’s Germiston precinct, aims to become a major hub for precious metals fabrication in South Africa for global export, while at the same time assisting local communities with skills development. The Intsika Skills Beneficiation Project provides jewellery design and manufacturing training to formerly unemployed young black women over an 18 month period.
The Ekurhuleni Jewellery Project is a Small to Medium Manufacturing Enterprise / Black Economic Empowerment incubator for qualified young black jewellery manufacturers. In partnership with government, Rand Refinery provides funding, workshops as well as access to precious metals to enable these young entrepreneurs to start their own businesses in a secure and enabling environment.
South Africa is home to precious metals such as gold, silver and platinum, and since the 1990s government has been pushing hard for the beneficiation of these metals in the country in order to extract more value. Mineral beneficiation involves the transformation of a primary material to a more finished product, which has a higher export sales value. The Krugerrand is the most visible form of beneficiation of South Africa’s gold.
Beneficiation has become one of the major drivers in advancing the empowerment of historically disadvantaged communities in South Africa. Government has also used beneficiation as an opportunity for the development of new entrepreneurs in big and small mining industries.