Higher platinum prices have unions flexing their muscles | Metals Mine

  • Higher platinum prices have unions flexing their muscles

    From businesslive.co.za

    The world’s biggest platinum producers face a dilemma: they’re reporting bumper profits just as they enter negotiations with unions over a three-year wage deal. The surge in earnings has been fueled by higher prices for palladium and rhodium, which are mined alongside platinum in SA. Noting the buoyancy of the market, the Association of Mineworkers and Construction Union (Amcu) has asked for a pay increase of as much as 48%. Satisfying that demand will lead to job losses and mine closures, companies say. “Amcu demands are ridiculous,” said Bernard Swanepoel, a former gold mine boss who now sits on the board ... (full story)

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swagtrading
Jun 27, 2019 11:15pm
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This is the problem with Labor unions. When they see higher commodity prices, they imagine direct addition to net profit and immediately demand higher wages, ignoring that companies sell forwards to guard against price fluctuation and also their input costs would have increased, so the net impact is less than what often looks to a layman's eye.

Also would labor union accept wage cuts when the commodities price plunge, as they often do, given their cyclical nature.
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