Gemfields says unrest could disrupt Mozambique ruby mine
Gemfields said in a statement that "groups associated with the illegal mining and trading of rubies have taken advantage of the political unrest".
The union representing about a third of nearly 100,000 gold miners in South African labour talks, has rejected an offer of a 13-percent pay rise.
The Association of Mineworkers and Construction Union (AMCU) hinted that a strike may be the next step in the long-suffering negotiations for a fair deal for employees and gold companies.
“If we need to go march at their offices we will,” AMCU President Joseph Mathunjwa told thousands of workers who gathered at the stadium next to a mine shaft about 300 kilometers (186 miles) south of Johannesburg, according to a Sunday post on Bloomberg.
Last Monday, South African gold companies tabled a five-year wage increase offer of as much as 13% to the industry’s unions, which said the proposed pay rise falls “way too short” of their demands.
Unions representing 94,500 gold miners want between an 80 and 100 percent salary hike from employers including AngloGold Ashanti (NYSE:AU), (JSE:ANG), Harmony Gold (NYSE:HMY), (JSE:HAR) and Sibanye Gold (NYSE:SBGL), (JSE:SGL).
Wages make up 55 percent of gold mining costs in South Africa.
Basic monthly pay is currently about 5,800 rand (US$457), but the AMCU union has demanded wages more than double to 12,500 rand. The largest gold-mining union, the National Union of Mineworkers (NUM), has lowered its demand to 9,500 rand, said Bloomberg.
Mining companies in South Africa feel squeezed by increasing costs as a result of the need to go deeper underground to mine the precious metal, and the gold price which has fallen 20 percent from 2015 highs of $1,313 an ounce.
The other three unions involved in the talks, NUM, Solidarity and UASA will respond to the wage proposal by Aug. 7, Elize Strydom, chief negotiator for the Chamber of Mines, told reporters on Friday.
9 Comments
Gary
This just might give the mining companies the reason they need to close down some of the troublesome South African mines.
Must admit you need ba*lls to demand between an 80-100% pay hike in the current climate unless of course you have no idea of the consequences
Eric
Agreed, they should take the booty and run with it.
Koos se Broer
This President or Leader of the Union, don’t know what he likes to call himself. Will be the reason for many people going home and starting a new job description (Thief). The mines will close down!!!!!!!!!!!!!!!!!, people will have no PAPA to eat.
The people don’t have a clue of the consequences they face when striking. YOU (Union Leader) WILL be the reason for many mine workers that will have no work on any mine anymore.
Someone should stop these so called Leaders from brain washing their members into striking and demanding for all they seek. The biggest problem today is not the Union members, its the Leaders thinking they run the show of the Unions. YOUR competition will fall short one of these days and your own people will turn against you. Some are not blind.
All the best for your striking ventures!
-I told you so!
J Silver
The article mentions the fact that wages constitute 55% of mining costs in south Africa, what is that proving?? The question is what are the huge profits made on the backs of miners who go in every day to perform a risky job.
All the other commentators here – so how do you maintain a decent standard of living with only R5800 a month exactly? Or is it simply scandalous to you that such people should deserve a better standard of living. Start changing your attitude and look at the equivalent wages a miner would get in developed and non-3rd world countries if this is what South Africa aspires to
Raoul Schur
As much as I sympathize with these miners’ absurdly low salaries, unfortunately the reality is that South African gold mines have always been based on cheap labor. Mines are extremely deep, and have not kept up at all with modern mining technology, and the deeper they go, the less worthwhile it is to mine at all. I see little future for SA gold mines. Even when the gold price rises, nothing will change.
drift123
They will close the mine(s). Wait a couple of years for technology to catch up. Buy back the mine at a very reasonable price. Open back the mine with a minimum of workers and most of the daily activities done by machines.
Some of the work could be done by remote in places like India were labor is still cheap (relatively to other countries). When India gets too expensive move the operations to some of the former U.S.S.R interior countries.
The largest labor cost would be for electricians, engineers, geologists and of course the stockholders and/or the executives.
Even if these miners don’t go on strike, technology will replace many of the workers, it is just a matter of time.
Kurtthekraut
Look north of SA borders: there in many countries the Chinese have taken over many a mine. And they bring their own labour. That’s their new way of colonisation. Result? More unemployment in SA and the wealth of the natural mineral resources goes once more to China.
bobby44
This may be the push miners need to mechanize / streamline the operations. New mines in developed countries can not rely on cheap labor so they are efficient (manpower wise) from the start, Never a bad thing to modernize!
As for the workers – they have always paid the price of progress. Educate, upgrade, be ready for the new world. It is coming and so , then, is a higher standard of living.
ultimatecurse
this will drive the price of gold up if less of it is mined and actually might help drive the price of gold back up. I thnk the diamond mining they were shooting the miners for not working. So I don’t they want to strike but they need a fair wage to eat and feed their family.