Platinum and Palladium jump as South African labor violence increases
Johannesburg-S.A. (May 13) Spot Platinum jumps $20 to $1455, while Palladium leaps $11 to $816. Lonmin Continues Mine-Reopening Plan Amid Violent Attacks -
Lonmin Plc (LMI) said it will push ahead with plans to break a 15-week strike tomorrow by reopening mines even after at least four people were killed in South Africa’s platinum belt over the last four days.
“Reconsidering the opening is not an option,” Happy Nkhoma, a spokesman for the world’s third-largest platinum producer, said today by phone. “What we need to make sure is that the employees are safe.”
No violence near mines belonging to Anglo American Platinum Ltd. (AMS), Impala Platinum Holdings Ltd. (IMP) and Lonmin was reported last night or this morning, Thulani Ngubane, a provincial spokesman for the South African Police Service, said by phone. Four people were killed and another six assaulted during various attacks over the weekend and yesterday, Ngubane said in a statement.
Members of the Association of Mineworkers and Construction Union, the biggest labor organization at the world’s three largest producers, have been on strike since Jan. 23. The AMCU wants basic monthly pay, without benefits, to be more than doubled for entry-level underground employees to 12,500 rand ($1,211) by 2017, while producers are including cash allowances in that figure.
Lonmin had “overwhelming support” from employees for a return to work after the company appealed directly to miners by text message and voice mail, Chief Executive Officer Ben Magara told reporters yesterday. The producer will have to cut jobs unless employees come back, he said. “We are appealing for peace, we are appealing for tolerance,” Magara said.
Stock Decline
Lonmin fell 4.4 percent to 259.3 pence at 1:16 p.m. in London, the lowest intraday level since July 3.
A group of men moved through the living areas around Lonmin’s mines last night singing insults to companies and non-striking workers, Sydwell Dokolwana, a regional secretary for the National Union of Mineworkers, said by today by phone. The group dispersed when police arrived, he said.
Producers of the metal, used in catalytic converters to reduce harmful emissions from automobiles, have lost 17.7 billion rand in revenue and employees 7.9 billion rand in wages due to the strike, according to a website run by the companies.
Platinum output in the country, which annually accounts for more than two-thirds of the world’s mined metal supply, dropped 44 percent in March, Pretoria-based Statistics South Africa said in a report today. The drop is the largest since February 2012, when production was cut because of a violent strike by rock-drill operators at Impala’s Rustenburg mines.
