Fed tests gold upleg
Gold’s outlook and fundamentals remain really bullish.
AngloGold Ashanti (NYSE:AU) was hit by the mining unrest that’s spreading through South Africa Tuesday night, as strikers halted all of its operations in the country. Operations which account for 32% of the multinational’s total gold production.
The world’s third-largest gold producer said most of its 35,000 employees have joined the industrial action when, on Tuesday’s night, miners prevented the company’s West Wits and Vaal River operations – joining co-workers who downed tools at AngloGold’s Kopanang mine on Sept. 20.
“This interruption to normal mining and processing operations comes amid unprocedural disruptions elsewhere in South Africa’s gold and platinum mining sectors,” warned the company in a statement.
The miner isn’t the only gold producer affected. Gold Fields (JSE, NYSE: GFI) also had to halt production in its mines after a strike that has lasted over two weeks.
“Notwithstanding press reports to the contrary, the unlawful and unprotected strike at the West Section of the KDC Gold Mine (KDC West, formerly Driefontein) on the West Rand in South Africa continues,” said Gold Fields in a statement.
Previously the company dealt with action affecting its KDC mine, on Johannesburg’s West Rand, which was resolved at the beginning of this month.
Gold Fields shares plunged 1.4% on Wednesday, and are down now nearly 10% from the August pre-strike figure.
Operations at Coal of Africa (CoAL) and Anglo American Platinum (Amplats), the world’s biggest platinum producer, have also been seriously disrupted by the strikes.
CoAL confirmed Tuesday it has stopped coal production at its Mooiplaats Colliery, which processes 6,000 metric tons of rock a day, after workers went on strike following the rejection of a proposed raise in annual salaries by 22%. This strike is protected by law, the company said.
Amplats’ operations continue to be shut because of a strike, while company representatives started talks with its striking workers Tuesday through a government labour mediator. But CEO Chris Griffith warned employees that disciplinary action would start on Thursday and reaffirmed that wage negotiations would not be entertained until the current agreement ended in six months.
More than better pay
At the heart of the non-stopping labour unrest hitting South Africa there is something far more complex than low salaries, writes analyst Michelle Smith.
With a democracy less than 20 years old, the struggles of apartheid and the promises made at its end remain fresh. Mine workers view themselves as working in a profitable, dangerous industry. They tend to be frustrated by the government, which they believe has short-changed them, and with unions, which they see as more concerned with brushing shoulders with business leaders and politicians than representing their members’ deplorable living conditions.
In the meantime, another union, the South African Transport and Allied Workers (Satawu) have also gone on an indefinite strike demanding wage increases.
Image: Lioness displays dangerous teeth at Kruger National Park – South Africa
Comments
serge
It is very sad for south africa. South african gouvernement have to maintain peace and stability in this country which is the model of développement in africa. If not… Serge