Minews - South African mine strike reportedly costing producers 4.4bn ZAR to date

(Minews) - The long-running strike at South Africa’s Anglo American Platinum (Amplats), Impala Platinum and Lonmin mines has cost the trio 4.4bn ZAR in revenue, according to reports.

Wages forfeited by the 70,000 miners who downed tools on January 23rd totalled $1.9bn ZAR, Bloomberg said, citing a statement from the companies.

The Members of the Association of Mineworkers and Construction Union (AMCU) are demanding that monthly wages for the lowest-paid underground workers be more than doubled to $12,500 ZAR.

Amplats was producing 5,000 ounces a day and had lost more than 60,000 ounces valued at $1bn ZAR, Chief Executive Officer Chris Griffith said at a presentation during parent Anglo American’s results in London on February 14th.

‘We sold just over 200,000 ounces in January so we continue our sales because of the stock we built up.’

Platinum is used for jewellery and to make catalytic converters for cars.

Griffith said in a separate interview earlier this month that meeting the union’s demands would double Angloplats wages bill and effectively force the company to close down.

Platinum prices are below the cost of production, adding pressure to mining firms. Despite the dispute, the price has not risen as the companies start to sell from reserves. Platinum was trading at $1450/oz on January 23rd when the strike started and was at $1422 on February 19th, according to Johnson Matthey’s Platinum Today website.

Amplats is suing the AMCU for $591m ZAR, claiming compensation for damage to property, increased security costs and production losses caused by non-striking employees being prevented from going to work.