The Association of Mineworkers and Construction Union (AMCU), the main coalition at Anglo American Platinum’s South African mines, has decided to postpone a decision on a possible strike over pay at the world’s biggest producer of the metal.
The company, which supplies 40% of the world’s platinum demand, has been taking steps towards consolidating five of its South African mines with nine shaft systems into three operating mines and reduce annual production by 350,000 ounces.
According to the firm, known as Amplats, those operations are not money-makers any longer, mainly due to mounting electricity and labour costs, as well as weaker prices. South Africa’s Chamber of Mines estimates that at least half of the country’s gold and platinum mines are still losing money or barely breaking even.
“The company is under tremendous economic pressure,” Chief Executive Officer, Chris Griffith, warned in September. “Strikes and work stoppages will result in further losses that will hamper plans for future sustainability and further threaten the future of our 45,000 employees.”
Earlier this year, Amplats lost almost 4,000 ounces of platinum production in only one day due a 24-hour strike.
But job cuts are a delicate subject in South Africa, where the unemployment rate is more than 25% and violent antagonism between main the mining industry’s labour unions has killed dozens of people over the past 18 months.