Codelco's Chuqui workers ask for 7,5% wage hike
miningweekly.com
By: Reuters
18th November 2009
SANTIAGO - Workers at Chile's massive Chuquicamata mine asked state copper giant Codelco for a 7,5 percent salary hike, union leaders said on Wednesday, in contract talks that could set a tough precedent for the world's top producer.
A strike at the nearly century-old Chuquicamata mine, which produced 315 000 t of copper in 2008, could stoke global supply fears that have helped push copper prices higher this year.
Three unions that represent about 6 000 workers, or 95 percent of the mine's workforce, also demanded more health and education benefits from the state miner in a new 30-month contract.
"The union has the capacity to meet our demands in a year in which the unions have helped the company meet its production goals," said Marcela Matamoro, a board member of Chuquicamata's No. 1 union.
Chuquicamata's No. 2 union leader Victor Galleguillos said "the unions will do everything to secure a deal with the administration ... however, a strike is always one of the options if no deal is reached".
He added that during the previous wage negotiation workers in Chuquicamata got a single 3.8 percent salary increase.
Both union officials said bonuses for workers will be discussed during negotiations. Codelco has 15 days to reply to their demands to start official negotiations that should end before the contract expires on Dec. 31.
A sharp increase in copper prices has emboldened mine workers across the world to demand more benefits from mining companies. After a 37-day strike, workers at Chile's Spence mine repeated threats to invade installations owned by BHP Billiton.
Copper prices have moved higher this week in part due to fears of output disruptions in China. On Wednesday copper for three-month delivery on the London Metal Exchange traded at around $6 870 per tonne after reaching 14-month highs earlier.
TOUGH TALKS AHEAD
"This is a different strategy in which workers are asking for a higher salary instead of more bonuses and could complicate negotiations for Codelco," said Juan Carlos Guajardo, head of the influential mining think tank Cesco. "Higher salaries mean higher operational costs for the company."
Codelco has launched an ambitious $9,7 billion investment plan to expand century-old mines like Chuquicamata and curb years of dwindling output.
Codelco produced 1,54 million tons of copper in 2008 and hopes to increase output this year with the ramp-up of new projects like the Gaby mine.
In comparison to Chuquicamata's wage proposal, workers at BHP's Escondida ,the world's biggest copper mine, got a 5 percent salary hike in a deal that analysts say raised the bar for companies gearing up for wage talks.
Codelco's Andina mine workers have demanded a 5 percent salary increase and are currently in negotiations with the company before their contract expires on Nov. 30. Andina produced 219 500 tonnes of copper last year. |
