Mine chaos mounts as strike wave hits Kumba
A SMALL group of strikers has brought Kumba Iron Ore’s Sishen mine — Africa’s largest iron-ore producer — to a halt. It is the 12th mining company affected by the wave of illegal work stoppages that is damaging SA’s image.
The strikes at gold operations in SA are large enough to prompt some analysts to downgrade global gold output this year.
Kumba, which is 70% owned by Anglo American, said yesterday that it suspended output at Sishen after 300 striking workers blocked access to the pit.
Analysts said this was one mine they had not expected to be affected by the strikes because 6,208 Sishen workers were paid up to R500,000 each in a share ownership scheme late last year and received two dividend payments this year.
Kumba recently signed a two-year wage agreement giving its workers an 8.8% wage increase against an inflation rate of 5%.
"It’s not just about economics. There is very little justification for what happened at Kumba, which does suggest it is either a covert political issue or it is simply a case of opportunism," Des Kilalea, an analyst at RBC Capital Markets in London, said yesterday. "There is a sense that labour relations in SA are ungovernable at the moment."
The 300 striking workers have not tabled demands and Kumba cannot determine who their leaders are to hold talks with them. The mine employs 12,700 workers, including contractors.
Kumba said it could supply customers "for some time" from its Kolomela and Thabazimbi mines, and it had stockpiles of ore at the Saldanha port and in China.
"The company has obtained a court order declaring the strike illegal ," Kumba said in a statement yesterday.
Anne-Laure Tremblay, of BNP Paribas, said yesterday that it was difficult to assess the effect of the strikes on gold production.
"Given SA’s large, though declining, share in world production, we have revised our global mine production growth estimate in 2012 to just +1% year on year from +4% year on year initially."
Gold mines have room to address workers’ wage demands through the sector’s existing wage agreement, signed in August last year, which would be "honoured and respected", Congress of SA Trade Unions’ general secretary Zwelinzima Vavi said yesterday after a meeting between the gold sector and the federation’s top brass at the Chamber of Mines.
Gold miners were represented at the talks by Mark Cutifani, CEO of AngloGold Ashanti and Nick Holland, CE of Gold Fields.
Mr Vavi, reading out a joint statement, said in terms of the existing wage agreement, entry-level wages and job categories would be reviewed. This process would start on October 9.
While mine bosses did not provide an undertaking that they would not act against workers on unprotected strikes, Mr Cutifani said companies would not do anything "provocative" to undermine the unfolding process.
The chamber earlier held high-level talks with the African National Congress (ANC), including its secretary-general Gwede Mantashe and two Cabinet ministers. Its CEO Bheki Sibiya described the meeting as "very successful". "It was actually the ANC, more than us, who committed to a stable sustainable, successful mining industry because it is the backbone of the economy," he said.
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