* Vote counting from 7pm local time, result hours after
* Union says pay offer nearly enough but no deal on job cuts
* Strikes could hit GDP growth after Cerrejon stoppage
By Peter Murphy
BOGOTA, July 17 Workers at Drummond Co Inc's
coal mining operations in Colombia were almost
certain to vote in favor of a strike action late on Wednesday
after failing to reach an agreement during weeks of talks over
pay and conditions, a union leader said.
"The majority will vote for a strike because they're seeking
better proposals from the company," Edgar Munoz, vice president
of the Sintramienergetica union, told Reuters in an interview.
A stoppage by Drummond workers would mark the second major
walkout in the Colombian coal industry this year after miners at
rival Cerrejon held a month-long strike that began in February.
Combined, the strikes could further dent economic growth in
2013, as coal is a top export earner for the Andean nation.
A prolonged stoppage at Drummond, which produces more than a
quarter of the coal from the world's fourth-biggest exporter,
could raise the price of European physical coal if it has an
impact on supplies as buyers contemplate buying for the winter
Physical coal prices for delivery to Europe are currently
trading around $75.60 a tonne, up from just above $70 in late
The country's artisanal and small-scale miners, which
produce a limited amount of Colombia's coal, also began a strike
on Wednesday to demand licenses to operate and that the outlawed
activity be made legal.
"We have been forced to beg in our own territory for our own
riches," said Ruben Dario Gomez, a spokesman for Conalminercol,
the small miners' union.
The miners began blocking roads early Wednesday.
If Drummond workers vote to strike, the stoppage would have
to begin after Friday and before the end of next week, to comply
with local labor laws, Munoz said, but it could still be called
off if Drummond made a satisfactory improved offer beforehand.
"Even after (Wednesday), there is still a possibility of
reaching an agreement," Munoz said.
"We understand the importance of this for the country and
the government's royalties. Striking means a big economic loss
for the workers and for the company. That is why we are trying
to find a solution without a strike," he said.
The Drummond strike would also be another headache for the
government as it tries to boost sluggish economic growth amid a
slew of labor disputes across the nation. Strikes in the coal
sector slowed GDP growth in the first quarter and could hobble
expected acceleration in the second half.
It also would come on the heels of an already difficult year
for Drummond. Loading at a port it controls was suspended in
February after bad weather caused a spill from a barge into the
water and there was a ban on night-time railway use on a line
part-owned by Drummond.
A Drummond spokesperson offered no comment on the issue when
contacted by Reuters.
UNION SEES PAY DEAL CLOSE
Ballot boxes in which workers have been casting votes the
last few days at the mines and in surrounding towns will be
recovered by 7 p.m. local time (8 p.m. EDT/0000 GMT) on
Wednesday for results to be calculated and announced an hour or
The union demands reached as much as a 10.7 percent pay
increase and a one-time bonus of 7 million pesos ($3,700), among
Drummond, which last weekend increased its pay raise offer
to 4.5 percent on top of a one-time bonus, has said the union's
demands for much more were beyond what would be sustainable for
it or any other mining company to pay.
But Munoz said he was confident the union could reach a deal
with Drummond over pay as the company's offer was near a level
it would accept. Negotiations to retain 400 workers at
Drummond's seaport, many of whose jobs Munoz said were
threatened by technological changes, were proving to be
Drummond had sought to cut some or all of the 400 workers,
Munoz said. The company said in a recent statement that it was
trying to find new positions for some of the employees and
devising a "withdrawal plan" for those it could not.
"On the question of salary, we can reach a deal," Munoz
said. "The difficult part of the negotiation is to do with the
relocation of the (port) workers."
Drummond employs about 10,000 workers across its main
Colombia operations, about half of which are direct hires
represented by Sintramienergetica and the other half contractors
represented by a separate entity. They would follow the outcome
of Sintramienergetica's members' vote, Munoz said.