South Africa platinum talks to end 6-week strike break down

Talks to end a six-week-long strike at the world's top three platinum miners in South Africa, have been suspended indefinitely, as the parties were unable to reach an agreement in a pay dispute, the Chamber of Mines said Wednesday.

Yesterday’s apparent softening of the radical Association of Mineworkers and Construction workers Union (AMCU) position was not enough to keep negotiations open.

The companies affected by the strike —Anglo American Platinum, Lonmin and Impala Platinum— said in a common statement the parties remain far apart.

“The revised demand by AMCU of an average basic wage increase of between 25% to 35% year-on-year over a four-year period remains unaffordable. We urge AMCU to take this opportunity to reflect on, and inform its constituents of, our current offer.”

The government mediator, the Commission for Conciliation Mediation and Arbitration (CCMA) said firms and workers will now consider the current offers, however Anglo American Platinum’s CEO, Chris Griffith, said the workers’ wage request would represent an average annual increase of 29% that continues to be unrealistic.

The strike has affected more than 40% of the global production of the metal, used widely in the auto industry. So far the companies say they have collectively lost more than US$640 million (6.9 billion rand) in revenue, according to the Chamber of Mines' online updates.

Platinum prices were trading at around $1,447 an ounce on Tuesday. Analysts say the price relative stability is due, in part, to the mining industry being better prepared than two years ago, when it was swept by a wave of violent strikes, triggered by the death of 34 miners at Lonmin's Marikana mine.

South Africa, Africa’s largest economy, holds about 80% of the world's known platinum reserves, accounting for about 70% of global output.