UPDATE 1-Drummond's Colombia coal miners begin unlimited strike

Tue Jul 23, 2013 7:41pm EDT

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BOGOTA, July 23 (Reuters) - Workers at the Colombian operations of U.S. coal miner Drummond went on strike at 6 p.m. (2300 GMT) on Tuesday, a union leader told Reuters, action that could cut coal output from the world's No. 4 exporter by about a third.

Drummond, which has two mines and a port in Colombia, and the Sintramienergetica union, which represents about half of Drummond's roughly 10,000 workers, have been in negotiations for weeks over pay, and job cuts for port workers due to begin in early 2014.

"The news is that from 1800 hours we are on strike. It is unlimited. Unfortunately the company wouldn't budge. It's a pity," said Edgar Munoz, vice-president of Sintramienergetica.

Drummond produced 26 million tonnes of coal, or almost one-third of the country's total output in 2012.

Although the seaborne coal market is currently well supplied, a strike, if prolonged, combined with expected increased demand from purchasers ahead of winter, could puncture that surplus and push up coal prices in Europe, where much of Colombia's supply is consumed.

Labor Minister Rafael Pardo Rueda joined last-ditch talks on Monday and Tuesday, underscoring the high stakes of a strike for the government. A month-long stoppage at rival miner Cerrejon in February was one factor behind slower growth in the first three months of the year.

Coal is one of Colombia's biggest exports.

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