Bloomberg News

Top Copper Union Threatens Strikes as Chile Shipments Restricted

April 04, 2013

Workers at Chilean copper mines owned by BHP Billiton Ltd. (BHP) and Anglo American Plc (AAL) are preparing protests to push for greater job security, a union leader said.

“These protests are a warning,” Gustavo Tapia, president of the Mining Federation of Chile, an umbrella organization known as FMC representing 11,000 workers, told reporters today from the city of Antofagasta. “We haven’t been listened to.”

The FMC’s proposal echoes measures announced March 15 by a union representing workers at state-owned Codelco. Both unions are seeking limits on the use of subcontractors in Chilean mines and said the protests will include strikes. Tapia didn’t elaborate on the timing or duration of planned strike action.

The announcement comes as a strike by port workers in the No. 1 copper-producing nation restricts more than half of its shipments of the metal as well as more than $50 million in fruit exports. Codelco is using more than 30,000 contract workers to run and maintain mines as well as carry out about $30 billion of expansions.

The port strike, which began March 16 at the Angamos terminal and spread to other ports in the country, is also restricting imports of materials such as sulfuric acid used by mines and may lead to the halting of some operations, Mining Minister Hernan De Solminihac told reporters in Santiago today.

World’s Biggest

Angamos handles copper cathode shipments from Codelco’s Chuquicamata, Gaby and Radomiro Tomic mines as well as some supplies from BHP’s Escondida, the world’s biggest copper mine. China accounted for 64 percent of Chile’s copper exports in February, according to data compiled by the central bank.

The planned industrial action by miners threatens to disrupt operations as copper trades near an eight-month low and the cost of production and development escalates.

Any strike action by mine workers in Chile would be outside of normal contract negotiations and, as a result, illegal, said Cesar Perez-Novoa, head of research at BTG Pactual in Santiago.

“Not only would you have a bad precedent for Chile, which accounts for 30 percent of global supply today, but that’s then extrapolated for the rest of the Pacific,” Perez-Novoa said by telephone. “Maybe there’s an element of politics. Because it’s an election year people think they may get away with demands.”

Chile holds presidential elections in November.

“This is an warning to the presidential candidates that they need to get with the program,” Agustin Latorre, a union spokesman, said today. “These themes aren’t going to go away.”

To contact the reporters on this story: Matt Craze in Santiago at mcraze@bloomberg.net; Randall Woods in Santiago at rwoods13@bloomberg.net

To contact the editor responsible for this story: James Attwood at jattwood3@bloomberg.net


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