[miningmx.com] – THE Associated Mineworkers & Construction Union (AMCU) has submitted gold industry wage demands, the Chamber of Mines said in a statement without providing details of the demands.
“The gold producers represented by the Chamber of Mines of South Africa confirm that the Chamber of Mines has received demands in respect of wages and other terms and conditions of employment by the Association of Mineworkers and Construction Union (AMCU),” it said in a statement.
“The Chamber will approach the trade unions with proposed dates for a pre-negotiation engagement to discuss process and procedures for the negotiations, as well as for a plenary meeting during which the unions will formally table and motivate their demands,” it added.
The National Union of Mineworkers (NUM) submitted its wage demands around May 19 in which it said it was seeking an entry-level minimum monthly wage of R7,000 for surface workers and R8,000 for underground miners.
Elize Strydom, the industrial relations adviser at the CoM, said the minimum wage for surface workers is currently R4,700 and R5,000 for underground miners. This is a demand of 60%, Reuters reported.
On a blended basis, the NUM’s wage demands were in ‘the high teens’, a demand that was still likely to face the opposition of margin-hit gold producers. The weakness of the rand against the dollar is one of the few factors stopped a fresh round of industry restructuring.
AMCU’s wage demands come on a day when the share prices of three of South Africa’s gold producers threatened to test or hit five-year lows with Harmony Gold the hardest hit. The firm, which produces nearly all its gold from South Africa, skidded 8.3% to R34.20/share. The company was worth twice as much in January.
The price of gold tested $1,275/oz in early New York trade before recovering as much as $10/oz at the time of writing.
Gold price weakness is linked to US Federal Reserve comments last week that quantitative easing would be reduced in the second half of this year and stopped in mid-2014 provided the US economy continued to grow.
In a research note last week, Macquarie Research said it thought the optimism of US Federal Reserve chairman, Ben Bernanke, was somewhat overplayed but added that the prospect of QE would come to an end soon would dominate the gold price.
“That we believe QE will continue longer than Bernanke predicts should provide some support to gold and silver prices, especially in periods when the US economic data
becomes more bearish,” said Macquarie.
“But it is unlikely to provide a medium term bull case for gold, given the eventual end
for QE is still in sight. Only if the data was to worsen sufficiently to change the Fed’s stance 180 degrees would US monetary policy be bullish again, and as of now that is not on the agenda,” it said.
