Copper prices continue to slide despite the threat of strike action at two of the world’s biggest copper mines – both owned by BHP – in Chile.
Workers at BHP Escondida and Spence copper mines in Chile, will seek to start strike action over a new award after government labour officials tried but failed to mediate an agreement over five days of talks.
“The (company’s) last offer is too low,” union secretary Robert Pasten told Reuters on Tuesday. “Today, in an assembly, we will decide about the strike.”
About 205 workers run BHP’s Integrated Operations Centre, which manages pits and cathode and concentrator plants in the north of the country from the Chilean capital, Santiago.
But in contrast to the continuing dispute with the union at Escondida and Spence, BHP has struck a new agreement with supervisory staff at its other mine in Chile, Cerro Colorado.The new labor contract with its supervisory employees will be in force for the next three years.
The threat of a strike in Chile comes as the country’s parliament looks to boost taxes on copper over the next three years – legislation has to be approved by the country’s Senate and if it is, then the Chilean conservative government is said ready to challenge the proposal in court.
Comex copper futures in New York Futures for delivery in July were down 2.1c a lb. at just over $US4.50 ($9,930 a tonne) on Tuesday afternoon.
Copper is down nearly 8% since hitting an all-time intraday high of $US4.88 two weeks ago.
In London LME copper prices ended lower at $US9,884 a tonne on Tuesday against the all-time high of more than $US10,724.50 a tonne.
But the BHP strike threat hasn’t moved prices on global markets – traders look like they are waiting for a vote and to see the reaction of BHP and the Chilean government.
The slide in copper prices came as more reports from China about government edicts to control commodity price inflation mentioned copper as well as iron ore, corn and soybeans.
Prices of those agricultural commodities softened in trading in Chicago on Tuesday on these reports and news from the US Department of Agriculture than corn plantings are running well ahead of normal.
But iron ore prices steadied after the sharp falls of last Friday and Monday off the back of attacks on price movements in the commodity from the government and talk of China boosting supplies outside of its major supplier, Australia.
The price of 62% Fe fines from Australia rose 45 cents to $US192.87 a tonne; the price of 58% Fe fines from Australia rose $US1.55 to $US165.02 a tonne and there was a $US4.50 a tonne rise in the price of high quality 65% Fe fines from brazil to $US228.80 a tonne.
