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Amplats talks tough, S.Africa illegal mine strikes spread

Source: Thomson Reuters Foundation - Wed, 26 Sep 2012 15:07 GMT
Author: Reuters
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* Amplats CEO says platinum sector "in crisis"

* Amplats says could start firing unlawful strikers

* ANC rebel to address Implats' workers on Thursday

* About 75,000 miners off the job in S.Africa

By Ed Stoddard and Sherilee Lakmidas

JOHANNESBURG, Sept 26 (Reuters) - An illegal strike spread through AngloGold Ashanti's South African operations on Wednesday, while Anglo American Platinum said it could start firing unlawful strikers on Thursday, as the country's miners grapple to rein in weeks of labour unrest.

A wave of wildcat action is roiling South Africa's mines despite the end of an illegal six-week stoppage at platinum producer Lonmin in which 46 people were killed and the price of the white metal was pushed higher.

Mining shares tanked in Johannesburg on Wednesday, with Amplats extending steep losses to over 6 percent after its chief executive Chris Griffith described the country's platinum sector as "in crisis".

Most of AngloGold's 35,000 workers have joined the wildcat action that began last week at its Kopanang mine. The company is the world's No.3 bullion producer and South Africa accounted for about 32 percent of its global output of close to 2 million ounces of gold in the first half of 2012.

Illegal strike action has also gripped Gold Fields and the world's top platinum producer Amplats, a unit of global mining group Anglo American.

Amplats said attendance at its four Rustenburg mines remained below 20 percent and it would take action against strikers from Thursday, including the prospect of dismissals.

It has made such threats before but then extended the deadlines, perhaps mindful of the violence unleashed when rival Impala Platinum fired strikers in January.

But CEO Griffith struck a tough tone in a conference call with journalists, saying: "At some point in time, we have got to put our foot down and we have now reached that position."

"We are not going to entertain wage negotiations at this point in time," he said.

Much of the platinum sector in South Africa has been battling with soaring costs and weak demand and Anglo American launched a review of its Amplats' operations months ago.

"Our Rustenburg mining operations are under considerable economic pressure and their future is already under review," Griffith said.

"The platinum industry is in dire straits at the moment. This is an industry that is in crisis," he said.

In total there are close to 75,000 workers on strike or prevented from going to work because of intimidation across South Africa's mining sector, about 15 percent of the workforce.

RED RAG

The steep 11 to 22 percent pay hikes extracted in the bloody standoff at Lonmin have been a red rag for others in an industry marked by glaring income and wage disparities.

ANC renegade Julius Malema, a populist who has backed the wildcat strikes and called for the nationalisation of the country's mines, said he planned to address Implats' workers on Thursday to encourage them to press for higher wages.

"Tomorrow I'm going to a mine, Impala mine in Rustenburg. I'm going to encourage the workers to demand 12,500 (rand a month)," Malema said outside a court in the northern city of Polokwane where he was charged with money laundering.

Malema, the former head of the ruling ANC's Youth League who was ousted from the party for ill-discipline in April, is tapping into a swelling vein of anger among miners to revive his political career and campaign to unseat President Jacob Zuma.

Lesiba Seshoka, spokesman for the National Union of Mineworkers (NUM), said the AngloGold strikers wanted a minimum of 16,000 rand (${esc.dollar}2,000) a month but the company said it had not received a formal wage demand yet.

If the demand is 16,000 rand it would represent a rise of as much as 400 percent on the basic wages of the lowest-paid workers in the sector. AngloGold and some of its rivals have two-year wage deals that are in place until the middle of 2013.

The NUM does not support the strikes but elsewhere demands have included the resignation of its leaders, a reflection of discontent among miners who regard the union as out of touch and too close to mine managers and the ANC government.

Gold Fields, the world's fourth largest producer, said on Tuesday workers had reneged on a deal NUM claimed to have sealed to end a two-week strike at its KDC West operation in South Africa and miners at its Beatrix mine had also downed tools.

?Illegal strikes erupted in the platinum sector in the form of a bloody turf war between the NUM and the more militant Association of Mineworkers and Construction Union (AMCU).

The strikes have now spread elsewhere but there is no evidence yet of AMCU involvement in the unrest. The country's truck drivers are on a legal strike over wages.

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