Masters of the Mountain

Chileans test copper's strength

Chilean miners are shaking up the global copper market. Demanding an increase in wages and compensation, they staged a strike, as a result of which metal prices went up. On Friday, management of the world's largest copper mine, Escondida (57.5% owned by British-Australian BHP Billiton), closed the plant due to an ongoing workers' strike, foreign agencies reported. However, on Saturday, under the influence of the Chilean government, the mine management was forced to negotiate with the strikers.

One of the main demands of the mine trade unions, which organized a strike on August 7, in which more than 2 thousand people took part (97% of the total number of workers), was the payment of a bonus of 30 thousand dollars per person and an increase in wages by 13%. The miners motivated their demands by a significant increase in the price of copper over the past two and a half years, since the last signed general contract with the employer establishing the level of wages. During this period, copper prices increased fivefold (from 1,500 to 7,500 dollars per ton), and in the spring of this year they reached a historical maximum - almost 9 thousand dollars.

In the first three days of the strike at Escondida, which accounts for 8% of global copper production, prices rose 3% to $8,015 a tonne. However, a correction began almost immediately. The closure of Escondida would hardly have a noticeable impact on Russian producers (Norilsk Nickel, UMMC and Russian Copper Company), since they have their own markets.

BHP closed the mine, saying it believed the strikers' demands were illegal and refused to negotiate. BHP Billiton said that the wages of workers at this mine significantly exceed the wage level for the company as a whole. Meanwhile, as a result of the strike, ore production at Escondida was reduced by almost half in a week and a half. Therefore, on Saturday, the mine management, including under the influence of the Chilean government, was nevertheless forced to negotiate with the strikers. As a result, in particular, Escondida management proposed a compromise - a 3% increase in workers' wages, an annual bonus of $15 thousand and soft lending conditions at the company's expense.

Negotiations continued yesterday, but at the time the issue was signed for publication, their results were not yet known. However, already on Saturday the mine management expressed hopes that work at Escondida would resume from the beginning of the week.

Anna LANDER