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South Africa's Implats shuts mines ahead of platinum strike

By Ed Stoddard and Olivia Kumwenda-Mtambo

JOHANNESBURG (Reuters) - South Africa's Impala Platinum (JNB:IMP) shut its Rustenburg operations on Wednesday a day before a planned strike over wages across the country's platinum belt by the hardline Association of Mineworkers and Construction union (AMCU).

AMCU, the platinum industry's main trade union, plans to strike from Thursday at Implats, Anglo American Platinum (JNB:AMS) and Lonmin (LMI.L), the top three producers of the metal used in emissions-capping catalytic converters in cars.

The union had also planned to strike in the gold sector but a court ruled that the strike be suspended pending a review of its legality.

Around 100,000 workers or a fifth of South Africa's mining labor force could down tools or be prevented from crossing picket lines in a stoppage that would hit over half of global platinum production.

However, Implats said it was closing its Rustenburg operations from its mines, processing units and smelter ahead of Thursday's strike to ensure the safety of its employees.

"We have also deployed additional security measures," spokesman Johan Theron said, adding those reporting for work during the strike would be paid even if the mines were shut.

The company said its Marula mine in the northern Limpopo province and Two Rivers mine in the eastern Mpumalanga province were not affected by the strike and had not been shut.

Amplats and Lonmin said they would stop operations with the morning shift on Thursday.

Police said officers would be deployed to the platinum belt to ensure the strikes were peaceful, a necessary precaution after a protracted and bloody turf war in 2012 and 2013 between AMCU and the rival National Union of Mineworkers (NUM).

The chief executives of the three affected platinum producers said on Tuesday the industry could ill-afford further production and job losses, noting they had lost a combined 879,400 ounces of output to labor stoppages in 2012 and 2013.

Platinum traded near $1,452 an ounce on Wednesday, near a three-month peak reached this week on the strikes.

Amplats said on Wednesday it swung back into profit in 2013 as it rebounded from a wave of wildcat strikes but its recovery is again threatened by this week's looming industrial action.


The government, lead by Deputy President Kgalema Motlanthe, has offered to mediate to try to end the dispute, which threatens South Africa's already struggling economy.

"The three platinum producers have all accepted, so they are willing to come together in one room to have one negotiating team," Motlanthe spokesman Thabo Masebe said. "AMCU did indicate that in principle they are willing to negotiate."

There were also signs of divisions in AMCU's ranks after dissidents said this week they planned to form a rival union, accusing its leadership of recklessly pursuing a damaging strike they say many miners do not want and cannot afford.

Vuyo Maqanda, AMCU shop steward at Implats, told Reuters workers there were holding a mass meeting on Wednesday to decide whether or not to heed the strike call by AMCU leader Joseph Mathunjwa.

"Mathunjwa told the workers they need to strike, whereas the workers don't want to go on strike. They have no money - it's January," he told Reuters.

The union was also threatening to strike over wages at gold mines operated by AngloGold Ashanti (JNB:ANG), Harmony Gold (JNB:HAR) and Sibanye Gold (SGLJ.J).

The bullion producers sought a court order to halt the action on the grounds that a wage agreement signed with last year with the NUM - still the majority union on the gold mines - applies to all workers in the sector.

The court is due to give its verdict on January 30 and ordered the strike be halted until then.

Besides the economic damage, President Jacob Zuma and the ruling African National Congress (ANC) are keen to avoid labor unrest ahead of general elections expected in around three months.

(Additional reporting by Zandi Shabalala, David Dolan and Ed Cropley; Editing by Ed Cropley, Mark Potter and David Evans)