BHP's quick strike fix sets tone for labor talks amid copper rally
BHP struck quick pay deal to defuse union strike at Escondida
Prolonged strike in 2017 influenced decision, analysts say
Escondida payout could loom over other labor contract talks
By Fabian Cambero
SANTIAGO, Aug 20 (Reuters) -Mining giant BHP's BHP.AX quick fix to a recent six-day strikeat its huge Escondida copper mine in Chile could set the tone for upcoming negotiations elsewhere, with workers emboldened by high copper prices to push for a larger share of the profits.
Members of Escondida's powerful Union No. 1 signed a sweetened deal on Sunday after walking off the job a week ago when contract talks collapsed, demanding better pay and benefits at the world's biggest copper mine.
With a preliminary deal in hand already on Friday, a union lawyer had termed the agreement its "greatest recent victory." It gave each worker a bonus and interest-free loan of about $34,000, compared with BHP's original offer of some $28,900.
The quick turnaround contrasts with a 2017 walkout that dragged on for a month and a half, severely hitting BHP's production, boosting global copper prices and even denting Chile's GDP, heavily reliant on the red metal.
That was a scenario BHP wanted to avoid, particularly given strong current demand and global copper prices, analysts and other experts said. Demand for the metal is expected to shoot up, driven by the rise of electric vehicles and artificial intelligence technologies.
"The specter of the 44-day strike in 2017 created constant fear throughout the negotiations," said Andres Gonzalez, an analyst at mining consultancy Plusmining. "BHP wanted to avoid something similar, which pushed them to seek an agreement."
The two sides were also not so far apart when the strike started, he noted, making a middle ground easier to achieve.
The union's position also appeared to be buoyed by the public perception of BHP having capital to spare. The miner is among the world's biggest, turning out more than a million metric tons of copper a year at Escondida alone. It recently soughtto acquire Anglo American AAL.L in a $49 billion deal before scrapping the offer.
"Its current image is that of a company that has capital available to acquire assets or even invest in mergers ... so the union was going to insist on achieving its goals," said Cristian Cifuentes, an analyst at Chilean think tank Cesco.
Despite occasional strikes, Chile's mining industry largely manages to renew workers' collective contracts without conflict and even in advance, avoiding the risk of disrupting production.
Escondida is unique due to its large size and powerful union, which represents 2,400 people, almost all in key operational roles. The union has frequently clashed with BHP.
'PROFITS HAVE TO BE PAID TO WORKERS'
Analysts are now watching whether Escondida will set a precedent, but say other mines in Chile are not necessarily in similar situations, such as those that are smaller or grappling with problems in production and costs.
State-run copper giant Codelco, fighting to revive production from a 25-year low, is due for pay negotiations at its Ministro Hales mine in September, followed by the El Teniente and Gabriela Mistral mines in October.
At each site, the unions represent a substantial part of the overall workforce. Of particular note is El Teniente, one of Codelco's biggest mines, a complex that represented more than a quarter of company copper production last year.
El Teniente workers are represented by five separate unions, but those combined represent more than 80% of total workers, or 3,200 people.
"What is worrying is how the unions at El Teniente will react," Cifuentes said.
Workers from one of three unions at Lundin Mining's LUN.TO Caserones copper mine in Chile also went on strike one day before the Escondida strike and remain so.
"The price of copper has been quite favorable in recent months... Those profits have to be paid to the workers," said Marco Garcia, president of the striking Caserones union, though he admitted the Escondida union had more "productive pressure."
"We know that the next three years will be quite profitable for Caserones in the production of copper," he added. "That's what leads us to our position and to be able to demand higher wages for the members of our union."
The Caserones management is due to negotiate with other unions at the site later this year.
The head of Chilean mining association SONAMI, Jorge Riesco, cautioned that it is necessary to strike a balance between worker pay and industry competitiveness.
"It is legitimate for workers to aspire to better working conditions, but it is important that they also consider other aspects," he said. "Issues of labor productivity and industry competitiveness should also be on the table."
Reporting by Fabian Andres Cambero in Santiago, Writing by Daina Beth Solomon; Editing by Adam Jourdan and Matthew Lewis
免責聲明: XM Group提供線上交易平台的登入和執行服務,允許個人查看和/或使用網站所提供的內容,但不進行任何更改或擴展其服務和訪問權限,並受以下條款與條例約束:(i)條款與條例;(ii)風險提示;(iii)完全免責聲明。網站內部所提供的所有資訊,僅限於一般資訊用途。請注意,我們所有的線上交易平台內容並不構成,也不被視為進入金融市場交易的邀約或邀請 。金融市場交易會對您的投資帶來重大風險。
所有缐上交易平台所發佈的資料,僅適用於教育/資訊類用途,不包含也不應被視爲適用於金融、投資稅或交易相關諮詢和建議,或是交易價格紀錄,或是任何金融商品或非應邀途徑的金融相關優惠的交易邀約或邀請。
本網站的所有XM和第三方所提供的内容,包括意見、新聞、研究、分析、價格其他資訊和第三方網站鏈接,皆爲‘按原狀’,並作爲一般市場評論所提供,而非投資建議。請理解和接受,所有被歸類為投資研究範圍的相關内容,並非爲了促進投資研究獨立性,而根據法律要求所編寫,而是被視爲符合營銷傳播相關法律與法規所編寫的内容。請確保您已詳讀並完全理解我們的非獨立投資研究提示和風險提示資訊,相關詳情請點擊 這裡查看。