Johannesburg - The world’s three largest platinum companies and the biggest union at their South African mines agreed on proposals that the labour organisation will take to its members in a bid to end a 20-week pay strike.
“‘In-principle’ undertakings have been reached with the leadership of the Association of Mineworkers and Construction Union in respect of wages and conditions of employment,” Impala Platinum, Anglo American Platinum and Lonmin said in a joint statements.
Platinum and palladium prices dropped on the news.
The companies expect to get a response from the union tomorrow.
The Amcu is meeting members at mines today to get their views on the proposal.
Workers at Impala, where Amcu leader Joseph Mathunjwa held his first rally, agreed on the proposals in principle, he said at the gathering.
More than 70,000 members of the union have been on a strike over pay since January 23.
Producers say workers have missed out on 9.9 billion rand in wages and that they have lost 22.1 billion rand in revenue.
The country’s mines minister said June 9 he was withdrawing from efforts to resolve the walkout, which has disrupted production in the country that accounts for about 70 percent of global mined platinum production.
“It was getting to the point where there was very limited visibility after the minister left the process so this is coming as a surprise,” Tyler Broda, a London-based mining analyst at Nomura International, said by phone.
“That’s what the equities and the metal prices are showing at the moment.”
Impala shares rose 1.7 percent to 114.99 rand by 2:28 p.m. in Johannesburg.
Anglo American Platinum declined 0.5 percent to 476 rand, while Lonmin surged 7 percent 253.3 pence in London.
Platinum for immediate delivery fell 3 percent to $1,437.38 an ounce and palladium sank 4.1 percent to $825.60 an ounce.
“This is not an offer,” Impala spokesman Johan Theron said by phone.
“The only agreement we have is that the union will go back to members and refresh its mandate.”
The companies and the Amcu will hold further talks should union member respond positively, Theron said. - Bloomberg News