Vedanta to exclude base metals business from sweeping demerger
The group said it will consider the base metals business demerger at a later stage.
South Africa is about to be hit, once again, by a major strike over wages across its gold and platinum sectors after the Association of Mineworkers and Construction Union (AMCU) — the country’s fastest-growing mining labour coalition— called miners to down tools by first shift Thursday.
About 100,000 miners are expected to go on an indefinite strike beginning Jan. 23, with gold producers Harmony Gold (NYSE:HMY), Sibanye Gold (NYSE:SBGL), and AngloGold Ashanti (NYSE:AU) (ASX:AGG), as well as platinum producers Lonmin (LON:LMI), Impala Platinum (Implats) and Anglo American Platinum (LON:AAL) being the most affected.
With unstable gold prices, companies closing mines and several firms claiming to be operating at a loss, the announced labour action is likely to lead to “even more job losses and even some mine closures,” the Chamber of Mines (CoM) chief negotiator Elize Strydom, told MiningWeekly Tuesday.
The situation is so critical for the gold sector, that the chamber has asked a South African court to rule Wednesday whether the strike called at the nation’s largest producers is or not legal and therefore, whether it can proceed.
“The order of the court will be followed,” AMCU President Joseph Mathunjwa told Bloomberg. “It goes both ways. If the court rules in our favour then the gold companies should respect that as well,” said the leader of this union, which represents about a fifth of gold miners in South Africa.
Platinum the most affected
William Tankard, research director of precious metals mining Thomson Reuters GFMS says investors should keep an eye on platinum, as it is the metal that will be most affected.
“The influence of AMCU within the South African mining sector is more extensive within the platinum industry than is the case with gold,” he told Kitco News. “This potential disruption is greatly more pertinent to the PGM space than it is to gold.”
Anglo American Platinum and Lonmin have scheduled meetings with the union in a bid to reach an agreement before Thursday, local reports say.
“The negotiations are ongoing. They [Amcu] stated they intend to go on strike on Thursday morning, so we shall wait and see what happens,” Lonmin’s Sue Vey told Sapa news agency.
South Africa, Africa’s largest economy, holds about 80% of the world’s known platinum reserves and is the fourth-largest gold exporter.
