Amcu strike to dent profits

The Association of Mineworkers and Construction Union (Amcu) will this week strike at the world's top three platinum producers, hitting more than half of global output and denting the margins of companies struggling to make profits.

Amcu members yesterday voted overwhelmingly in favour of a strike at the world's largest platinum miner, Anglo American Platinum, in a show of hands in a stadium in Rustenburg.

In recent days they had voted to strike at Amplats' rivals Lonmin and Impala Platinum.

Amcu president Joseph Mathunjwa told the rally that Amplats would be served notice of the strike action today and workers would down tools on Thursday.

It said last week it would do the same at Lonmin and spokesman Jimmy Gama said after the mass meeting that Impala Platinum would also get its notice today.

"Comrades, let's intensify the struggle for a better wage," Mathunjwa said.

He earlier swept into the stadium in a brand-new Lexus car, flanked by three burly white bodyguards, to a rock star welcome and wild cheers from the Amcu members.

At Amplats and Lonmin, the union is seeking a minimum monthly wage of R12500 for entry-level workers - more than double current levels, under the populist battle cry of a "living wage".

At Implats, the union scaled back its demand late last year to just over R8500.

Companies have said they can ill afford steep increases as power and other costs soar against the backdrop of depressed prices for the white metal used in emissions-capping catalytic converters in automobiles.

Amplats announced a year ago that it planned to mothball shafts and lessen production in order to stop making losses. The long-awaited review of its operations was also said by the company to "affect" as many as 14000 employees at the time. A harsh backlash from the Department of Mineral Resources followed with Minister Susan Shabangu saying at the time that she had not been consulted.

Amcu members also embarked on a strike shortly afterward but returned to work within days. The company has since watered down its plans.

The platinum price was hit hard by the financial crisis and the recession that followed as the demand for new vehicles slowed, especially in the US and Europe.

Not only feeble demand, but also increased competition from platinum recyclers has kept the platinum price subdued.

Platinum recycling now puts more than two million ounces of the metal back onto the market every year, close to Amplats's annual production.