South Africa's gold miners set to strike
JOHANNESBURG, July 28
JOHANNESBURG, July 28 (Reuters) - Tens of thousands South African gold miners will down tools on Thursday, intensifying a wave of strikes and potentially costing the gold mining sector $25 million a day in lost output.
Unions representing coal workers were set to meet the chamber of mines in a last-ditch bid to end a wage strike in that industry also.
Some 100,000 workers at AngloGold Ashanti , Gold Fields , Harmony Gold and another smaller mining group were due to go on strike after shifts end at 1800 local time (1600 GMT).
"There will be a total shutdown of the entire gold mining industry for it is inconceivable how the industry could want to give workers an increment of 7 percent when the gold price is at a record high," said a statement from the NUM, which wants 14 percent from the gold producers.
Africa's largest economy was partly built on its vast gold reserves but dwindling grades, deeper mines and investor jitters have pushed it from first to fourth in global production.
The strike is unlikely to affect the spot price which hit record highs above $1,625 an ounce on Wednesday on U.S. and Europe debt woes. Analysts say a prolonged strike may buoy the price on bullion.
In other sectors, an almost three-week strike in the petroleum sector that sparked panic buying at the pumps looked like it might end while another in the platinum industry loomed.
Union leaders are to meet petroleum industry officials on Thursday to say whether a revised offer had been accepted, said Nerine Kahn, director of the Commission for Conciliation, Mediation and Arbitration, South Africa's labour mediator.
The country's "strike season" is in full swing with unions demanding 10-15 percent pay rises. Inflation is five percent.
If most settlements come in near double digits, economists have warned that inflation could accelerate and interest rates could start climbing faster than expected from their lowest levels in three decades.
The African National Congress therefore has a delicate political balancing act as it tries to woo investment while maintaining an alliance with organised labour that delivers much of its voting base.
But, while shares in gold mining companies slid this week, South Africa's rand and bond markets gained ground as the U.S. dollar faltered.
Markets on Thursday will also be watching the outcome of talks between the unions and Anglo American Platinum , the world's No. 1 producer of the precious metal which accounts for about 40 percent of global production.
The two sides remain poles apart with NUM demanding 20 percent and Amplats' last public offer at 4.6 percent.
Companies say they can ill afford steep increases even with commodity prices sky high as they grapple with other rising costs such as fuel, power and explosives.
But the official inflation rate does not tell the whole story for many miners, who are lower or mid-income workers with many dependents and spend much of their take-home pay on food and fuel, costs of which are rapidly rising.
Some economists warn that rising labour costs are eroding South Africa's status as an investment destination since its workforce is already more expensive and less productive than those found in many of its emerging market rivals.