Freeport Exhausted Copper Stocks on Peru Strike, Union Says
Freeport-McMoRan Copper & Gold Inc. (FCX)’s Peruvian copper mine exhausted its stockpiled ore after a strike entered its 22nd day, according to a union official.
The company’s Sociedad Minera Cerro Verde SAA (CVERDEC1) unit, where workers have been on strike since Sept. 29, shut its concentrator plant yesterday after contract workers damaged an ore-crushing facility, union official William Camacho said.
“The plant will be shut for three days, and the mine has run out of stock because there’s no blasting going on in the pit,” Camacho said today in a telephone interview from Arequipa, 750 kilometers (466 miles) southeast of Lima. “The mine won’t be able to meet its production goals.”
Workers in Peru, Chile, Bolivia and Indonesia have downed tools at copper, gold and zinc mines this year to seek improved conditions and a larger share of record profits after metal prices surged. About 8,000 workers at Freeport’s Grasberg mine in Indonesia have been on strike since Sept. 15.
The mine, Peru’s third-largest copper producer, is operating at two-thirds of capacity after the company took on 600 non-union staff, spokesman Eric Kinneberg said today in e- mailed comments. Freeport, the world’s largest publicly traded copper producer, will take part in all wage negotiation meetings, he said.
The company expects the dispute can be resolved “in the near term,” Freeport Chief Executive Officer Richard Adkerson said yesterday on a conference call to discuss third quarter earnings. The stoppage hasn’t “materially” affected copper and molybdenum output, according to the company.
Cerro Verde workers and company officials were scheduled to resume wage talks at 11 a.m. New York time today. The union won’t accept either a company proposal to cut benefits if the price of copper falls to $2.70 per pound or a deadline set for tomorrow for a 1,200 soles ($433) bonus if workers sign a labor accord, Camacho said.
Freeport says its Grasberg mine in Indonesia is operating at about two-thirds of capacity. Grasberg, which has the world’s largest recoverable reserves of copper, lost 70 million pounds of sales in the third quarter because of a strike, Freeport said.
Freeport rose 0.6 percent to $34.5888 as of 2:02 p.m. in New York. Cerro Verde dropped 2.8 percent to $34.60 in Lima.
Copper for December delivery fell 20 cents, or 6.1 percent, to $3.0575 a pound at 1 p.m. on the Comex. On the London Metal Exchange, copper dropped $475, or 6.6 percent, to $6,735 a ton.
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