UPDATE 1-SAfrica unions, gold firms deadlocked over wages

* Arbitration authority call in to mediate

* Mediating authority helped avert strike in 2007

* Harmony weighs further wage offer to unions

(Adds Harmony, NUM, Solidarity, Chamber quotes, details)

By James Macharia

JOHANNESBURG, June 11 (Reuters) - South African mineworkers' unions said on Thursday they were deadlocked with gold producers over wage demands and would strike should an arbitration authority fail to reconcile the parties.

The 300,000-strong National Union of Mineworkers (NUM) and the smaller Solidarity union rejected an improved offer of 7 percent from gold producers, and called in a mediator, the Commission for Conciliation, Mediation and Arbitration (CCMA).

Mine workers have demanded a 15 percent pay rise, well above South Africa's consumer inflation of 8.4 percent.

A new wage deal is due to take effect on July 1.

The unions say their wage demands can be met because the price of gold has risen despite the global economic downturn.

But South African gold producers, who negotiate as one under the Chamber of Mines, say the unions' wage demands plus their request for additions to other allowances represent a total demand of 28 percent, and would dramatically raise production costs, jeopardising the long-term survival of their industry.

"It has always been our intention to bargain in good faith, to try reach a settlement through negotiations..., but this year looks like we will have to use a different tool in strike action," Frans Baleni, the NUM general secretary said.

"Strike action is and has always been the last resort. It is unavoidable this year."

Elize Strydom, who negotiates on behalf of gold mining companies, welcomed the arbitration authority's involvement.

"We are committed to finding solutions and a real balance between the needs of the employees and the companies," she said.