KHARTOUM – Sudan’s Mining Companies Union warned that gold production could come to a halt if the current purchasing and pricing mechanism imposed by the Central Bank of Sudan remains in place, saying the policy is undermining companies’ ability to continue operating.
In a memorandum dated Sept. 15, 2026, addressed to Minerals Minister Nour Al-Daim Mohamed Ahmed Taha and the director-general of the Sudanese Mineral Resources Company, the union said the current system for purchasing domestically produced gold has created serious economic and operational pressures on mining firms.
The memorandum said companies remain committed to paying government dues, meeting obligations to workers, suppliers and financiers, and complying with the laws governing the mining sector.
But it warned that the current pricing mechanism is placing additional burdens on producers and making continued production increasingly difficult.
Union Calls for Cancellation of Central Bank Circular
The union rejected the current pricing mechanism and called for the cancellation of Central Bank Circular No. 11, issued on May 13, 2026.
It said the dispute was not simply about seeking a marginal increase in the gold purchase price, but about a system that obliges companies to sell gold at prices that do not reflect what they consider its real economic and market value.
The union said returns under the current mechanism may not cover the true costs of production, investment, exploration, development and mine preparation.
It pointed to sharply rising costs for fuel, energy, maintenance, labor, logistics and security services, saying these expenses have significantly increased the financial burden on mining companies.
The memorandum also objected to applying similar treatment to smaller mining companies and larger concession holders despite differences in production structures, operating costs and investment models.
Warning Over Capital Flight and Production Decline
The union warned that forcing companies to sell gold under a pricing system that differs substantially from its market value could reduce profitability, discourage investment and ultimately lead to lower production.
It said such a system could also contribute to capital flight and weaken companies’ ability to sustain operations.
The union argued that gold producers should not be required to absorb losses arising from broader distortions in Sudan’s foreign exchange market.
Companies Reject Responsibility for Currency Crisis
The memorandum said mining companies are not responsible for determining exchange rates, managing foreign currency markets, controlling liquidity or addressing inflation.
It argued that the gold purchasing mechanism should not be used as a tool to transfer the financial cost of currency distortions onto producers.
The union said challenges related to exchange rates, liquidity, inflation and foreign currency management should instead be addressed through appropriate monetary, fiscal and economic policies.
It warned that adding new financial burdens to companies already exposed to high production and investment risks could threaten the sustainability of the sector.
Questions Over Agents and Pricing Differentials
The union also raised concerns about the role of agents and intermediaries involved in the Central Bank’s gold purchasing process.
It called for greater transparency over who purchases and aggregates gold, how prices are determined, the commissions and incentives paid, and the regulatory framework governing these arrangements.
The memorandum said companies should be clearly informed about the basis used to calculate the amount paid to producers and what agents, aggregators or other intermediaries receive.
It also said the system should not allow intermediaries to obtain economic advantages greater than those available to the companies that actually produce the gold.
Call to Protect Mining Investment
The union stressed what it described as companies’ legal and commercial rights, including the protection of their investments and their entitlement to operate under clear and sustainable rules.
It said mining companies do not object to the state regulating the sector, collecting lawful dues or taking measures to protect the national economy.
But it warned that policies that reduce the value received by producers while increasing operating costs could make gold production economically unsustainable.
Gold remains one of Sudan’s most important sources of foreign currency and export revenue, making the stability of formal production particularly significant as the country faces a deep economic crisis.
