Lonmin’s Marikana
platinum mine
“’ the centre of
renewed labour unrest.
Johannesburg, South Africa — 15 May 2013 –  Workers at platinum producer Lonmin’s shafts have continued their wildcat strike for a second day, raising concerns that the bitter turf war between rival unions could escalate into anarchy and violence.

Fin24 reports that production at all 13 shafts of Lonmin, near Rustenburg, 120km north-west of Johannesburg, was halted yesterday as protesters demanded the closure of the National Union of Mineworkers (NUM) offices at Lonmin. The company has said that the Association of Mineworkers and Construction Union (AMCU) now represents over 70% of the company’s workforce.

“At all the shafts at Marikana, nobody reported for night shift and nobody reported for day shift this morning,” said Lonmin spokesperson Sue Vey. Lonmin has increased security at the mines following reports of intimidation and has urged all employees to return to work.

“Management is in discussions with our recognised trade unions to ascertain the reasons for the stoppage and to encourage workers to return to work,” Lonmin said in a statement. The company employs 27,000 people and 10,000 contractors, according to Vey.

The platinum belt towns of Rustenburg and Marikana, which saw violent strikes at Lonmin and other producers last year, are a flashpoint of labour strife, with tensions running high over looming job cuts and wage talks. Aggravating the situation is a turf war between AMCU and NUM.

Yesterday Lonmin’s share price slid over 7% and the rand hit three-week lows as investors worried about a repeat of 2012’s turmoil, which hammered platinum and gold production and triggered credit downgrades.

Violence at the mine in August 2012 erupted from a dispute over pay and left 44 people dead “’ including 34 shot dead and 70 injured by police on a single day “’ and led to about 250 arrests.

A prolonged disruption could pose a threat to Lonmin’s forecasts of increased output. The company said this week that it planned to exceed production of 700,000oz of platinum metals in concentrate this year, after the 2012 strikes had cut volumes and raised costs.

About 2,000oz a day of platinum production could be lost if a strike is under way and operations are disrupted, said Bank of Montreal analyst Edward Sterck in a note to clients.

Source: Fin24 and Bloomberg News. For more information, click here. , or here