Strike hits SA platinum producer

Impala produced almost two million ounces of platinum last year

Workers at the world's second-largest platinum producer, South Africa's Impala, have gone on strike, stopping production at its largest mine.

About 17,000 employees failed to turn up for work on Thursday at Impala Platinum's mining and processing centre eighty miles north of Johannesburg.

The dispute centres on the terms of a two-year wage deal and talks should resume on Friday.

Impala said the walk-out would cost it 28m rand (£2.4m) a day.

Wage dispute

Stoppages began on Wednesday evening when workers failed to show up for the evening shift.

Talks between Impala, which produces one third of the world's platinum, and representatives from the National Union of Mineworkers (NUM) had earlier stalled over the terms of a two-year pay deal.

Agreed last year, the deal offered workers a 9.5% pay increase in the first year and an inflation plus 1.5% rise in year two.

Production has come to a standstill Humphrey Oliphant, Impala

The agreement included a clause allowing either party to renegotiate should the actual increase turn out to be less than 7.5% or more than 9%.

Reuters reported that Impala wanted 7.5% to be the trigger point for renegotiation while unions wanted it to be 8.5%.

"Production has come to a standstill," Impala's human resources director Humphrey Oliphant told Reuters.

Fresh strike threat

"This is likely to be the case until at least Friday when we are due to meet the union again."

"I cannot say how long the strike will continue, it depends on management," said Archie Palane, a spokesman for the NUM said.

"They must come up with a package that will satisfy our members."

Analysts said it would be several weeks before the strike affected supplies as existing stockpiles were high.

Impala dismissed 1,700 rockdrill operators in June for taking part in what the firm said was an illegal strike.

However, the workers were reinstated days later when the dispute was settled.

Unions are also threatening strike action at Anglo Platinum, the world's largest platinum producer, after rejecting the South African's firm 7.5% pay offer.

Anglo Platinum said talks were currently taking place on the basis of a revised offer it had made on Wednesday.

The NUM's Mr Palane said workers would down tools immediately if the firm's offer was not satisfactory.