Codelco strike - something to watch forHopefully this isn't yet another supply interruption for ARG.
Strike halts Codelco's Andina, Salvador
Wed Apr 16, 2008 6:58pm EDT
By Manuel Farias
SANTIAGO,April 16 (Reuters) - Fighting pitched battles with police, Chileansubcontract workers on Wednesday started a new strike at all ofstate-owned Codelco's divisions over work conditions and pay, forcingthe No.1 global copper producer to close its Andina and Salvadordivisions.
An estimated 2,000 workers massed at Codelco's ElTeniente mine alone, knocking giant tubes off the back of a flatbedtruck as they were sprayed by water cannon. They also set fire torubber tires on the road.
However, Codelco said its Codelco Norte, Teniente and Ventanas divisions were operating normally.
Thestrike helped push copper prices on the London Metal Exchange up morethan 4 percent in intraday trade, to within a whisker of all-time highs.
"Dueto security reasons, operations at the Andina division were suspendedthis morning, and this afternoon a similar decision was taken at theSalvador division," Codelco said in a statement.
Andina liesaround 50 miles (80 km) northeast of the Chilean capital Santiago andproduced 218,000 tonnes of copper in 2007. Salvador lies 685 milesnorth of Santiago, and produced 64,000 tonnes of copper last year.
"Codelcois sorry that a small group of people, who lend their services throughsome subcontracted companies, are trying to affect its productionactivities through the use of violence and threats," Codelco saidearlier.
Cristian Cuevas, president of the Confederation ofCopper Workers which groups more than 30,000 workers at state-ownedCodelco, said hundreds of subcontract workers had massed at the firm'sdivisions to block access to mines.
STRIKE INDEFINITE
"Weare calling for the intervention of the government, because Codelco haslied to the country, to the church and to the workers," Cuevas toldReuters by telephone at El Teniente, where he was leading the protest.
"Our patience has run out," he added. "We will not lift this strike until there is an immediate solution."
Copperfor three-months delivery closed 3.4 percent firmer at $8,720 a tonneon the LME after hitting an intraday high of $8,810.25 a tonne. Theextent of copper's rally is seen dependent on the impact of the strike.
Copper hit an all-time record of $8,820 a tonne in March.
Cuevassaid workers were striking at the Codelco Norte, Salvador, Andina andEl Teniente divisions, and were blocking access to Chuquicamata as wellas the firm's Ventana smelter.
The Confederation demands Codelcofulfill agreements reached in July 2007 which ended a long, sometimesviolent strike for improved benefits and pay.
Subcontractedworkers want pay and benefits in line with those enjoyed by Codelco's14,000 unionized employees who do the same jobs across Codelco's fivedivisions.
They also want the company to absorb some 5,000subcontract workers into its full-time ranks. Mine workers in Chile ingeneral feel there is insufficient trickle-down of windfall earningsfrom Chile's main export at a time when prices for the red metal arearound record highs.
Codelco says it has complied withagreements reached last year, but subcontractors say it has donelittle, other than make token gestures.
Codelco is the world'slargest copper producer, with annual output of about 1.7 million tonnesper year. (With reporting by Simon Gardner and Monica Vargas; Editingby Christian Wiessner)