Negotiations have failed and workers at the world’s largest copper producer are to go on strike

Spark Global Limited reports:


Unions at mines owned by Codelco, the world’s largest copper producer, are to go on strike after five days of government mediation.

The Union of Integrated Labor Industries (SIIL) and united Workers (SUT) at Chile’s Andina copper mine said they would resign within 24 hours.

Members of the two unions voted 82 percent to reject the latest contract offered by Chile’s state copper company after government-mediated talks, according to a joint union statement.

Spark Global Limited reports:

Spark Global Limited reports:

In a statement, the union said the refusal was due to the fact that ENcosur had stated its intention to eliminate historic benefits such as health care for workers, while taking no responsibility for improving workers’ new social benefits and ignoring the high price of copper.

The state copper company has not responded to the union’s request.

Last year, Andina produced 184,000 tons of copper, about 11% of enico’s production and 3% of Chile’s national output.

In addition, the El Teniente copper mine, owned by CNPC, has been in tense collective negotiations with five unions.

On Aug. 10, workers from five unions rejected the mine’s latest offer, saying the two sides were still at odds over basic issues such as labor and management.

The erteniente mine’s labor contract with the union expires at the end of October, involving about 3,345 workers.

The El Teniente mine produced 443,000 tons of copper last year, the fourth-largest in the world, according to Kitco, a precious metals retailer and information service.

Reuters reports that the surge in copper prices to record highs this year has given Chilean unions extra leverage, increasing tensions in collective bargaining and putting pressure on global supplies of non-ferrous metals.

On the morning of August 10, 320 workers at the Caserones copper mine, owned by JX Nippon Mining & Metals, also went on strike after failing to reach an agreement.

JX Said in a statement that it regretted the workers’ decision to give up their contracts and resign from their jobs, but that it remained open to further negotiations.

Caseron produced 126,000 tons of copper last year, about 2.2 percent of Chile’s total output.

BHP Group Ltd’s Escondida copper mine is also at risk of a strike.

In early August, workers at the Escondida mine said in a statement that more than 99 percent of the union’s 2,175 members had voted to reject a pay offer from BHP Billiton and decided to strike and demand a better contract with the company for the next three years.

Then the Chilean government stepped in to mediate. With government mediation slow, unions said on August 6th that workers were preparing for a strike.

On Aug. 9, after the first five-day period for government mediation expired, The Escondida mine’s unions and management agreed to an extra day of mediation talks to avert a strike.

On August 11, the Escondida mine union and BHP billiton said in a statement that they had reached a tentative agreement on a new contract, but that the union would take two more days to put the new contract to a vote by workers.

Escondida is the world’s largest copper mine. Last year, the mine accounted for 1.156 million tons of copper, about 20% of Chile’s copper production and nearly 6% of global copper production, according to Kitco.

Hongyuan Futures Research said the rising risk of strikes in South America has increased the risk to global copper supply. Supply disturbance, copper prices are expected to remain strong in the short term.

By 11:00 on August 12, London Metal Exchange (LME) copper was $9559.55 a tonne, up 0.5 percent from the previous day and about 50 percent from a year ago.