News
South Africa: 2 mines re-open despite continuation of labor unrest
(Reuters) – Two South African mines reopened on Monday after labor strife forced them to suspend operations last week, but striking miners vowed to keep operations run by world No. 1 platinum producer Anglo American Platinum (Amplats) shut.
Wage talks were set to resume in a bid to end a 5-week strike at the Marikana mine of platinum producer Lonmin, bringing its production to a halt and pushing up the price of the precious white metal.
The unrest has its roots in a turf war for members between an upstart union and the dominant National Union of Mineworkers (NUM) but it is now unclear who the strikers are taking their direction from.
Police used tear gas and rubber bullets over the weekend as part of an operation to disarm miners, implementing the government’s decision to get tough on strikes that choked off platinum output in the world’s top producer.
Aquarius Platinum’s Kroondal mine and Xstrata’s chrome operation near the platinum belt city of Rustenburg restarted on Monday. Aquarius’ shares in Johannesburg were up more than 12 percent by 0800 EST.
Amplats said work at its Rustenburg mines would resume on Tuesday, a move dismissed by one workers’ representative as a “joke”. The unrest and illegal strikes have spread from Marikana to Rustenburg along the restive platinum belt.
“For us, the reality is that the general strike is on,” Mametlwe Sebei, a self-styled Rustenburg community leader and Marxist politician, told Reuters. “We are going to be demonstrating in defiance. We will not be intimidated.”
Amplats management was “whistling in the dark” if it believed the mines would reopen on Tuesday, he said.
“They can deploy the police, but let us be clear, there will be repercussions,” he said.
A spokesman for Xstrata Alloys said miners returning to work in Rustenburg on Monday had been subjected to intimidation by striking colleagues and that the atmosphere remained tense.
“As our employees were coming to work, there has been intimidation which is all over Rustenburg,” said Christopher Tsatsawane said.
Wild Cat Strikes
Xstrata and other platinum mines in the area have been hit by wildcat strikes since August 16. All of Lonmin’s mines remain closed.
South Africa is home to 80 percent of known reserves of platinum, the price of which has gained nearly 20 percent since the strikes began. The sector accounts for 6 percent of South Africa’s economy, the biggest in Africa.
Police raided a Lonmin hostel on Saturday and seized weapons from strikers. They later used rubber bullets and tear gas to disperse groups of protesters.
Lonmin said mining activity at Marikana remained minimal and lowered its full-year production guidance to between 685,000 and 700,000 saleable ounces from 750,000 ounces.
Lonmin said on Monday it was temporarily closing its K4 shaft. That ends a contract with construction group Murray & Roberts that supplied about 1,200 staff to that shaft.
On Friday, workers at the mine dismissed an initial Lonmin offer as way below the 12,500 rand (US$1,500) a month sought by members of the militant Association of Mineworkers and Construction Union (AMCU), which is challenging the influence of the more established NUM.
Lonmin, which is offering increases of between 9 and 21 percent, said 12,500 rand (US$1,500) would put thousands of jobs at risk and challenge the viability of the business.
The ruling African National Congress (ANC) has become increasingly worried about the impact of the unrest on the wider economy.
Finance Minister Pravin Gordhan said it could be “extremely damaging”, although in an interview with Reuters on Sunday he said there was no need yet to revise the outlook for the country’s fiscal performance for this year.
The ANC criticized companies for paying lip service to the mining charter, which seeks to give workers and communities a bigger share of mineral wealth and rectify disparities of white apartheid rule by improving their living and working conditions.
“Mining remains the bedrock of the South African economy, and yet the abject poverty and squalor surrounding mining areas remains a matter of deep concern,” it said in a statement.
“The current instability at Marikana thus poses challenges to the growth of the sector and the international image of the country,” the ANC said.