HomeNewsAnglo braced for full impact of South African strikes

Anglo braced for full impact of South African strikes

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LONDON – Miner Anglo American reported increased volumes in five of its seven key commodities while bracing for the full impact of South African strikes on platinum and iron ore output.

Anglo’s labour woes – compounded by nagging concerns over its Minas Rio iron ore project in Brazil and operational trouble in Chile – have revived long-standing concerns among some investors over the group’s exposure to South Africa.

Its management is already under fire over the group’s underperforming share price.

Labour troubles across the South African mining sector spread to Anglo American Platinum, the world’s top producer of the precious metal, last month, just before the end of the current reporting period.

Weeks later, they hit Anglo’s Kumba Iron Ore unit, which alone accounted for almost half the group’s operating profit in the first half.

Kumba’s Sishen Mine has since begun to ramp up operations, but Amplats workers have not yet returned to Amplats’ Rustenburg, Union and Amandelbult mining operations.

Anglo said iron ore production for the three months to the end of September rose 14% to 12,5 million tonnes. The illegal strike at its Sishen began only at the start of October.

Over the month so far, though, the key South African miner has lost 2,2 million tonnes of finished product.

Platinum production, meanwhile, was flat, again in line with forecasts, at 649 000 ounces, though Anglo cut its production target for the year, trimmed planned spending and warned unit costs increased by 8% in the third quarter.

The strike caused the loss of 42 000 ounces of equivalent refined platinum in the third quarter, and an additional 96 300 ounces from disruption so far this month.

Copper, however, was a brighter spot for Anglo, despite ongoing operational trouble at Chile’s Collahuasi, where it has now intervened with partner Xstrata to resolve operational, management and safety concerns. -Reuters

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