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2 July, 2007
Negotiations in the gold, platinum, chrome, diamond, coal, and iron ore mining sectors of South Africa head into July with the National Union of Mineworkers (NUM) and major mining companies being far apart on wages.
Disputes have been declared in nearly all the talks, with NUM seeking two-year increases ranging from 11% at DeBeer's diamond-mining operations to higher at platinum and gold mining operators. Contracts expired on 30 June but talks are likely to continue throughout July, under the guidance of the CCMA, the governmental agency where NUM has filed for dispute resolution. Such filings are necessary before a union can legally take strike action.
This set of negotiations comes amidst an escalating South African inflation rate, especially food and fuel costs. The talks also come when commodity prices are high, and the mining houses are reaping huge profits.
Gold and platinum, two natural resources in which South Africa leads the world in production, have seen rising demand, resulting in higher pricing. Gold was selling for US$420 an ounce in early 2005. In June 2007, it was selling for nearly US$653 an ounce. And platinum, which finds South Africa supplying 75% of the world's markets, has seen price rises of 18% since the beginning of 2007.
NUM is seeking wage increases for the two years in most sectors of about 15%.
"When we talk of double-digit (increases) we mean business and we are not in the business of playing games with our members' mandates," said NUM General Secretary Frans Baleni.
NUM General Secretary Frans Baleni
To date in talks, the mining companies have put forward wage offers that fall far short of South African inflation. The Chamber of Mines, representing AngloGold Ashanti, Goldfields, and Harmony in gold talks, have offered only 6%. DRDGold is bargaining outside the chamber, but its current offer is insufficient.
The same can be said for the chamber's low offer in coal negotiations. In platinum, where AngloPlatinum, Impala Platinum, Lonmin, and Northam are the country's leading producers, the employers' wage offer of between 6-7% falls short of NUM goals.
At Kumba Resources, an iron ore producer, the NUM is seeking 13.5%, while DeBeers offer to diamond miners is 7% next to NUM's demand for 11%.
The NUM knows that no mining settlement has ever been reached without a fight. Now, as negotiations head into July, South Africa's largest and most militant trade union expects just that.