Rampaging protesters are wreaking havoc in the world’s leading platinum sector, forcing the closure of another major mining operation as South African workers grow increasingly militant in the aftermath of a deadly police crackdown.
Anglo American Platinum Ltd., the top global producer, decided to shut down four of its shafts on Wednesday when about 1,500 protesting mine workers – many waving machetes and sticks – blockaded roads and marched to the company’s gates near Rustenburg in South Africa’s platinum belt.
Amplats said it closed the mines temporarily because it feared for the safety of its 19,000 workers, who were already facing threats from the protesters on Wednesday.
South Africa produces about 80 per cent of the world’s platinum, and Amplats alone is responsible for nearly 40 per cent of the world’s production.
The wildcat strikes have also begun spreading into South Africa’s gold industry, with 15,000 workers off the job at Gold Fields Ltd., the world’s fourth-biggest gold producer. Security guards fired tear gas at thousands of protesting workers on Wednesday when the workers tried to stop a passing train at the mine site.
In total, three of South Africa’s largest mines are now at a standstill because of worsening labour unrest, with about 43,000 workers on strike or staying away from work.
The labour militancy, fuelled by hardline opponents of President Jacob Zuma, is inflicting heavy damage on the mining companies and on South Africa’s global reputation.
Lonmin PLC, the world’s third-biggest platinum producer, remains at the heart of the labour battles. At least 45 people have been killed in clashes near the company’s Marikana mine over the past few weeks, including at least 34 who were gunned down by police in the “Marikana massacre” on Aug. 16.
South Africa’s third major platinum producer, Impala Platinum Holdings Ltd., endured its own violence-plagued strike for six weeks this year, and its workers are now demanding another pay increase. Impala is the world’s second-biggest producer.
At Lonmin, mediators have been struggling to solve the labour conflict with little success. The illegal strike at Marikana is now entering its second month, and only 1.8 per cent of workers reported to duty on Wednesday. The company is believed to be losing $4-million a day because of the wildcat strike, with losses reaching at least $90-million so far.
Violence has become endemic on all sides of the labour conflict. Two policemen were killed in the early stages of the Lonmin strike, and some of the protesting workers were reportedly shot in the back or deliberately murdered as they fled from police. Many of the 250 arrested workers at Marikana say they were tortured or beaten by police. Another dead body was discovered this week in a place where the strikers gathered, although it was unclear who killed him.
Lonmin has threatened to lay off workers if the wildcat strike continues. “No business can operate in an environment where threats and intimidation are the order of the day,” a Lonmin spokesman said this week.
“The continuing efforts of a minority to keep the mine closed through threats of violence now pose a real and significant threat to jobs,” the spokesman said.
Some of the labour militancy is due to a split among the unions, with the traditionally dominant National Union of Mineworkers facing a revolt by a new union that accuses it of being too conservative and too close to the ruling African National Congress.
But the labour clashes are also fuelled by political renegades, including the expelled ANC youth leader Julius Malema, who are exploiting the crisis to undermine Mr. Zuma and regain power in the ruling party.
Mr. Malema has been roaming across the mines, giving fiery speeches to the striking workers and urging them to intensify the pressure on the mining companies. This week he called for a national strike at all mines.
The strikers at Lonmin and Gold Fields are demanding a monthly wage of 12,500 rand (about $1,460) – two to three times more than their current take-home pay.
World platinum prices have soared by almost 20 per cent since the strikes began, including a rise of nearly 3 per cent on Wednesday. Platinum is used in jewellery and in catalytic converters to clean exhaust fumes in vehicles.
Many foreign investors are already avoiding South Africa’s mining industry because of its poor labour relations, and the latest strikes will make this worse. “Militant strikes will scare off the local and foreign investment needed to develop new mining ventures,” said Humphrey Borkum, former chairman of the Johannesburg Stock Exchange, in a commentary in a Johannesburg newspaper on Wednesday.