Johannesburg, South Africa — ESI-AFRICA.COM — 01 August 2011 – Striking South African coal and gold miners will meet the Chamber of Mines in separate talks today in a bid to end stoppages that have cost Africa’s largest economy tens of millions of dollars in lost output.
Coal workers have been off for a week while some 100,000 gold miners downed tools on Thursday, halting operations at AngloGold Ashanti, Gold Fields and Harmony Gold at a time when bullion is at record highs.
The new round of talks will seek to end the week-long coal miners’ strike. Analysts have said if the stoppage persists for at least another week, exports to Asia and Europe could be disrupted.
A prolonged strike could also choke supplies to South African national power utility Eskom , which provides almost all of South Africa’s power and almost exclusively runs on coal. Eskom has said it has around five weeks of stocks, but this could be used up quickly, threatening power supplies across the country. .
Coal firms affected include Anglo Thermal Coal SA, Exxaro, Optimum Coal and Xstrata Coal.
Reuters reports that gold’s run has been driven by its safe-haven status amid the debt crises in Europe and America, but analysts have said a prolonged strike in South Africa, the fourth-largest producer of the precious metal, could also support its price.
Spot gold was fetching US$1,613.44 an ounce this morning, compared with a record high of US$1,632.30 on Friday. The index of South African gold miners shed 5.4% last week, on investor concern about lost output even as the commodity rallied.
But South Africa’s rand and bond markets have shrugged off the strikes, which have also hit the country’s fuel, chemical and diamond sectors, and the gains they have achieved could be extended this week on the gold price and technical factors.
Today’s talks were due to start at 0800 GMT. Negotiators have narrowed the gap on the gold front, raising hopes of more progress, though neither side is predicting a breakthrough.
“They have put something on the table and we are looking at that and consulting with our members, and will come back today to see if there can be some improvements in their offer,” National Union of Mineworkers (NUM) general secretary Frans Baleni told Reuters ahead of the talks.
The markets will also be watching wage talks between unions and Impala Platinum, the world’s second largest producer of the precious metal.
Impala and its larger rival Anglo American Platinumn, which is also engaged in negotiations, together account for around two-thirds of global platinum output, so strikes against them will almost certainly support the metal’s price.