(Bloomberg) -- Workers returned to work a day after the resolution of a labor conflict that disrupted key operations at the world’s largest copper producer, ending a strike that helped lift prices and deepen the global shortage of the metal.
Operations were running normally on Friday as miners returned to their posts at 5 a.m. local time, a Codelco official said by phone. On Thursday, the three main unions said 75% of workers at Codelco’s Chuquicamata mine in northern Chile voted in favor of the state-controlled company’s offer for a collective contract. The mine had been operating at over 60% capacity during the 14-day strike, according to the company.
BMO Capital Markets estimated lost production at 7,000 tons, commodities analyst Colin Hamilton said in a research note on Friday. Chuquicamata produced 321,000 tons of copper last year. The lost production could widen the supply gap that the International Copper Study Group estimated at 189,000 metric tons this year.
The unions and the workers they represent are satisfied with the outcome of the negotiation, Cecilia Gonzalez, president of Union No. 1, said by phone. The company fully agreed to three of the unions’ main demands, and partly agreed to a fourth, which involved giving existing and new workers the same wages and benefits, she said.
“We did what was right for workers and this strike will be a turning point in our relationship with the company,” Rolando Milla, president of Union No. 3, said by phone. “Now we need to get back to work and we’ll try to have the mine running at full capacity as soon as possible.”
Copper prices rose to the highest in more than a month earlier this week amid reports that talks were stalled between Codelco and the three unions representing 3,200 workers at the mine. Prices rose 0.2% to $6,003.50 a ton at 3:54 p.m. in London.
“We have reached three agreements that fulfill workers’ expectations together with the challenges of our mining business,” Chuquicamata general manager Mauricio Barraza said in an emailed statement. “Together we need to transform this business so it remains profitable and sustainable over time.”
Workers accepted the state-owned company’s offer of a 36-month contract that included:
14.1 million-peso ($20,750) bonusReal-wage increase of 1.2%Retirement package for the 1,700 workers due to leave the mine as Chuquicamata transitions from open pit to undergroundNew health-care benefits for workers hired from Jan. 1 2020
(Updates with company comment on return to work in second graph.)
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