By Dhiladhila Magazine · Issue 05
For a century Namibia has shipped its ore out raw. Oshivela is a bet that the value is in the making.
On 11 April 2025, on a desert farm outside Arandis, President Netumbo Nandi-Ndaitwah declared the HyIron Oshivela plant open and, with it, tried on a different idea of what Namibia sells to the world. For a century the country has shipped its minerals out unprocessed. Oshivela, the first industrial site to make iron with green hydrogen, is a wager that the value sits in the making, not the digging.
The economic claim behind the ceremony was specific. By turning ore into finished green iron at home rather than exporting the rock, the government argued, Namibia can capture six to eight times more value from the same resource. The plant is small for now, but the argument it tests is the size of the whole economy.
From raw rock to reduced iron
The export economy has long rested on selling unprocessed material – uranium, diamonds, base metals – and buying back the finished goods made from it. Oshivela reverses that order for iron. Its first phase will produce 15,000 tonnes a year of direct reduced iron, the sponge iron that feeds a steelworks, using hydrogen split from water instead of coal to strip the oxygen from the ore.
The scale is modest and deliberately so. A first phase costing N$600 million (about US$32 million) is a demonstration, not yet an industry. What it demonstrates is that reduced iron can be made in Namibia to a standard a foreign mill will buy, which is the precondition for everything that follows.
The first tonnes matter less as volume than as proof the country can finish its own ore.
The value-addition arithmetic
The six-to-eight-times figure is the heart of the case. Raw iron ore trades as a low-margin commodity; direct reduced iron made without carbon sells into a market that is starting to pay for clean provenance. Every step of processing kept onshore – reduction now, briquetting and eventually steel later – adds a margin that currently sails away with the ship.
This is beneficiation stated as policy rather than slogan. President Nandi-Ndaitwah tied the plant to value addition, natural resource beneficiation and industrialisation, the long-stated goals that raw exports have rarely delivered. Oshivela is the first to attach a working plant to the phrase.
Beneficiation only counts when a kiln, not a policy document, does the adding.
Why carbon-free changes the trade
Timing is part of the economics. Europe is phasing in a carbon border levy that will tax the emissions embodied in imported metal, and traditional iron carries a heavy carbon load. Iron reduced with green hydrogen arrives with almost none, which turns Namibia’s renewable resource into a trade advantage that other iron exporters cannot easily match.
That is why a German steelmaker has already contracted to buy Oshivela’s output. The plant is not selling a commodity into a crowded market; it is selling a scarce, low-carbon input that its buyers need to keep their own products sellable under tightening rules.
Clean provenance is not a virtue here – it is the pricing power.
Small plant, national question
The risk in reading too much into one plant is real. Fifteen thousand tonnes will not reshape a national export account built on far larger commodity flows, and the later phases that would – a tenfold expansion, then another – remain plans, not tonnage. The economics work at demonstration scale; they are unproven at industrial scale.
Still, the direction is set. If the model holds, Namibia moves from selling the cheapest link in the iron chain to owning a more valuable one, on the strength of sun, ore and hydrogen it already has.
The question Oshivela poses is national even while its output is small.
For a resources executive or a policymaker, Oshivela reframes the export question from how much ore to ship to how much of it to finish at home. The decision it forces is whether to keep treating minerals as cargo, or to fund the plants that turn Namibia’s raw material into the higher-margin product the world is now willing to pay a premium for.
Sources: HyIron – Oshivela opening; Namibia inaugurates pioneering green iron plant (The Namibian); N$600m zero-emission green iron plant opens (New Era)
