Latest on the Chilian strike
BHP Escondida Mine Union Ready to Hold Out 30-60 Days (Update3)
By Jeb Blount
Aug. 23 (Bloomberg) -- Striking BHP Billiton miners in Chile said they are ready to extend their walkout at the world's biggest copper mine by another six weeks unless the company improves its contract offer.
Miners at BHP's Escondida, who have been on strike since Aug. 7, are ready to hold out for 30 to 60 days after yesterday lowering their wage and bonus demands, said Luis Troncoso Munoz, president of the Escondida miner workers union.
Prices for copper, Chile's biggest export, have quintupled in four years on surging demand for the metal from China, prompting mine workers to seek a larger share of mining profits. BHP today announced second quarter profit of $6.1 billion, the largest quarterly net income in company history and the largest ever for a mining company. The company also plans to buy $3 billion of its own stock from shareholders.
``The company will lose if they try to break off dialog and hire outside workers,'' said Toncoso Munoz in an interview at his office in Antofagasta. ``We really don't understand why they are taking such a tough line when they are making such large profits; the amount we are asking is nothing compared to the amount they are giving back to shareholders.''
Workers are seeking a wage increase of 8 percentage points above inflation, down from a previous demand for a 10-point increase, union spokesman Francisco Aedo said yesterday in a phone interview from Antofagasta. Workers also seek a bonus of 10 million pesos ($18,792), down from 16 million pesos, he said.
BHP Australian-traded shares fell 36 cents, or 1.3 percent, to A$28.39.
Precedent
The demands at Escondida are going to be repeated in contract negotiations underway or expected to begin before the end of the year, Troncoso Munoz said. His union and those representing workers at BHP's Spence Mine in northern Chile and at mines owned by Codelco, plan to use any Escondida agreement as a benchmark for their own, he said. Chile's government-owned Codelco is the world's No. 1 copper producer.
The union at Escondida is ready to renew talks at any time, Troncoso Munoz said.
Copper futures for December delivery fell 1.05 cents, or 0.3 percent, to $3.4675 a pound on the Comex division of the New York Mercantile Exchange. Prices have more than doubled in the past year.
BHP has been calling workers, seeking to rehire them as allowed under Chilean labor law, said Mauro Valdes, vice president of corporate communications with BHP in Santiago. There have been no talks between the union and BHP since the union rejected BHP's last offer Aug. 21.
Grievance
The union said Escondida management has tried to undermine worker's resolve to continue the strike in the phone calls to them and their family members.
``They are trying to scare the wives and children of workers into thinking that the strike will lead to the loss of their jobs,'' Troncoso Munoz said, as he left the union offices to file a grievance over the issue.
``They do have the right to try to hire new workers or talk to strikers, but we consider their tactics improper and unconstitutional,'' he said.
To contact the reporter on this story: Jeb Blount in Antofagasta, Chile at jblount@bloomberg.net
Last Updated: August 23, 2006 18:23 EDT
AI
