“D-Day” For South African Platinum Mines
Beleaguered platinum mines continue to be disrupted as ongoing scuttles between mine workers, platinum miners and South African police forces continues. On Thursday, South African police opened fire against thousands of striking miners armed with machetes and sticks at Lonmin’s Marikana platinum, leaving between 7-18 individuals dead. The outbreak of violence occurred as police laying out barricades of barbed wires were outflanked by some of an estimated 3,000 miners amassed on a rocky outcrop near the mine, 100km north-west of Johannesburg.
According to police, discussions with the Association of Mineworkers and Construction Union have broken down, “leaving no option but to disperse them by force.”
Here is the gruesome video:
“Today is unfortunately D-day,” said Dennis Adriao, spokesman.
Before this most recent clash, 10 people, including two police officer, have been killed in nearly a week of fighting between rival worker factions at the mine, which is the latest platinum plant to be hit by fallout from eight-months of platinum miner strikes in the world’s main producer of the precious metals.
Wednesday, upwards of 3,000 police officer, including members of an elite, camouflage-wearing riot control unit backed by helicopters and horses, confront the striking rock-drill operators. There were no clashes.
Before the advance of the police, Joseph Mathunjwa, president of AMCU, said there would be bloodletting were the police to move in.
“We’re going nowhere,” he shouted through a loud hailer, to cheers from the crowd. “If need be, we’re prepared to die here.”
The dislocations have caused Marikana’s London-headquartered owner to halt production at all its South African operations, which account for 12 percent of global platinum output. Lonmin has claimed to have lost 15,000 ounces of platinum from the six-day disruption, stating that it is unlikely it will meet its full-year production target of 750,000 ounces. Its London-listed shares fell 6 percent on Thursday, bring losses due to the violence to more than 13 percent.
At least three were killed in January at the world’s largest platinum mine, Imapala Platinum, that led to a six-week closure of the mine, a dislocation which helped edge the platinum price up 15 percent. Home to 80 percent of known platinum reserves, South Africa’s issues are affecting the market as rising power and labor costs and a sharp drop in the price of precious metals are joined by the miner protestation of working conditions.
Obviously, these miners are not treated humanely by their “owners” over in London. Nevertheless, platinum is the rarest precious metal in the world, and 80 percent of the world’s platinum production comes out of South Africa. There have already been considerable disruptions to the supply of platinum, which has a year supply output of 130 tons; that is, 6 percent of the annual gold supply.
Platinum was by far the biggest mover today in the precious metals, rising 7.75% by eastern trading, with palladium more than 5% below that mark in its 3.25%+ day and evening. This is to be no surprise considering the aforementioned. The rise in platinum, however, is not something to be celebrated, considering the blood of workers which had to be spilled to give impetus to the gain in price.
This event is by no means “D-Day,” as the one gentlemen commented. D-Day took place when violent hoards took on violent hoards as the Invasion of Normandy signaled an open turning point in World War 2. Today’s events in South Africa are nothing like that. Instead, men armed with toy weapons were gunned down with military power by a national government.
I would take a sorely-botched haircut in the platinum market before I would wish for the blood of mostly good men to be spilt.