Platinum Miners Win Reprieve as South Africa Strike Delayed
(Bloomberg) -- The world's biggest platinum miners won a reprieve after a South African court reserved judgment on whether to block a week-long industry strike that was scheduled to start Thursday night.
The Association of Mineworkers and Construction Union called the action in sympathy with members at Sibanye Gold Ltd.'s gold mines, who downed tools over wages in November. Producers have warned the strike would hurt the industry, which is finally getting back on its feet as platinum-group metals recover. The threat of disruption has helped boost platinum and palladium prices this week.
Read: World's Biggest Platinum Miners Ask Court to Block Strike
The strike “cannot start until there is a judgment,” said AMCU spokesman Manzini Zungu. A South African labor court reserved judgment late on Wednesday over the interdict. AMCU issued a notice to at least 15 companies last week about the strike.
South Africa's precious-metals mines are among the world's deepest and most labor-intensive and companies operating them are under constant pressure to contain costs. The Minerals Council lobby group estimates producers could lose 1.3 tons of platinum-group metals production, equal to more than 500 million rand ($36 million), for each day that workers don't show up.
Impala Platinum Holdings Ltd., the number-two producer, would see a material impact if the strike went ahead, including a “devastating” effect on its Rustenburg operations, Chief Executive Officer Nico Muller said in a presentation Thursday. The company is in the midst of a deep restructuring effort at Rustenburg to stem losses at the sprawling mining complex.
Anglo American Platinum Ltd. rose 1.5 percent by 4:06 p.m. in Johannesburg, while Sibanye was 0.2 percent higher and Lonmin Plc gained 1.7 percent. Impala Platinum Holdings Ltd. jumped 8.7 percent after reporting earnings earlier.
©2019 Bloomberg L.P.
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