Anglo American Platinum (Amplats), the world’s top platinum producer, has extended until Wednesday its deadline for an estimated 30,000 striking South African mine workers to get back to work in the South African mining industry's latest attempt to draw a line under a year of devastating work stoppages.
Amplats, a division of London-based Anglo American PLC (PINK:AAUKY) that is offering a one-time payment of about 4,500 South African rand, or $512, to get back on the clock, hopes the national labor federation representing the workers, known as COSATU, will be able to urge the workers to accept the deal and back off their demand for a monthly wage increase of the same amount of cash offered as a one-time payment.
"COSATU was approached by the strike committee to engage with them to facilitate a return to work of the employees who are currently on the illegal strike," Amplats spokeswoman Mpumi Sithole told Reuters.
The country’s mining sector problems are also the world’s. According to a report Tuesday by specialty chemicals company Johnson Matthey, the worldwide supply of platinum will be down 10 percent this year. South African mining strikes and safety stoppages in the first nine months of the year have resulted in a loss of 300,000 ounces. Meanwhile, a global deficit of 400,000 ounces is predicted for the year, due to a “firm” demand of 8.07 million.
Amplats is considering shutting down some South Africa operations. The company, whose parent has a market cap of more than $40 billion and paid two dividends to shareholders in March, said it cannot afford to raise the workers’ salaries by $512 a month, which it claims would add $296 million a year to its annual South African payroll. The strike has cost the company $250 million in lost productivity.
The country’s mining sector has been grappling with labor unrest for much of this year. At least 50 people have been killed since August, mostly a result of police actions against work stoppages and protests that have been deemed illegal because they have not been authorized by union organizers. Some of the deaths have been linked to union militants, too.
On Tuesday local police said they discovered the latest casualty: a dead 56-year-old mine worker from Mozambique found lying in a soccer pitch near an Amplats laborers’ housing facility. The man appeared to have been stoned to death.
"It is alleged that he was part of a group of workers who were returning from duty when they were assaulted by striking mine workers," police spokesman Ronell Otto said, according to AFP.
The strikes have also affected gold mining operations in the country, but those actions have been resolved—at a cost. Last week, Johannesburg-based AngloGold Ashanti Limited (NYSE: AU), the world’s third-largest gold producer, announced last week in its disappointing quarterly report that it will lower its dividend to shareholders due to South African strikes that cost it $400 million.