Platinum strike losses exceed 2012 level as talks in gridlock

Comment on this story


Andre Janse van Vuuren

Production losses at the largest platinum companies caused by a seven-week strike have now eclipsed those from stoppages in 2012 as talks over pay with the Association of Mineworkers and Construction Union (Amcu), which is leading the walkout, are deadlocked.

Anglo American Platinum, Impala Platinum and Lonmin had lost about 499 000 ounces by yesterday, calculations of figures from the producers show. A spate of strikes in 2012 that erupted into violence, leaving 44 people dead, cost 496 359 ounces of output, excluding production lost as mines gradually resumed full operations.

The Commission for Conciliation, Mediation and Arbitration suspended talks on March 5 because the producers and Amcu remained far apart.

“We’re still in a deadlock,” Johan Theron, a spokesman for Impala, said yesterday. “Nobody has made any movement.”

Workers downed tools in 2012 for higher wages as they defected from the National Union of Mineworkers to join Amcu. The current walkout was called by Amcu on January 23 to support its demand for monthly entry-level pay of underground miners to be more than doubled to R12 500. The three employers, who are negotiating as a unit, have offered to increase current basic pay of R5 000 by 9 percent a year.

The price of platinum for immediate delivery has changed little since the strike began, even as Impala said it couldn’t guarantee deliveries to customers from next month.

The companies had lost more than R8 billion in earnings, a website run by the three producers showed. Striking workers had foregone R3.6bn in wages, it said.

The strike was unlikely to be settled before it entered its eighth week, Mark Rosenberg, an Africa analyst at New York-based Eurasia Group, said.

“Amcu will struggle to sell any deal that doesn’t include an end-goal of R12 500 which, even if phased over a number of years, is starkly unaffordable for producers.”

Amcu said on March 5 it would accept an offer that reached its preferred level within three years.

“As the strike moves into its eighth week, we expect negotiations to pick up,” he said. Amcu might extend its time horizon for getting to its demand “to something like five years”.

Anglo American Platinum rose 0.81 percent to close yesterday at R449.37, Impala climbed 0.53 percent to R117.55, and Lonmin moved up 0.28 percent to R53.17. – Bloomberg


sign up
 
 

Comment Guidelines



  1. Please read our comment guidelines.
  2. Login and register, if you haven’ t already.
  3. Write your comment in the block below and click (Post As)
  4. Has a comment offended you? Hover your mouse over the comment and wait until a small triangle appears on the right-hand side. Click triangle () and select "Flag as inappropriate". Our moderators will take action if need be.

     

Join us on

IOL-Social networks IOL-Social networks IOL-Social networks IOL-Social networks