Platinum is among the world’s rarest and most valuable metals, prized for its strength and its contribution to cleaner air, cancer care and electronics. Almost three-quarters of world production comes from a single place — South Africa — leaving the metal and the country’s politics inextricably linked. For many platinum miners, things haven’t changed much in the 20 years since apartheid ended, offering a familiar contradiction between the luster of the metal, along with its precious cousins, gold and diamonds, and the fortunes of the people who dig it out of the ground.
Platinum workers walked off the job when an industrywide strike began Jan. 23, paralyzing production of South Africa’s top export. In the shantytowns of corrugated metal shacks where many of the country’s 198,000 platinum miners still live, discontent with the pace of pay increases has escalated and even turned violent. Police shot and killed 34 protesters at a Lonmin mine on Aug. 16, 2012, fueling the anger and the rise of the Association of Mineworkers and Construction Union, now the biggest representative of employees. The new union is seen by workers as less beholden to the ruling African National Congress party than the more than 30-year-old National Union of Mineworkers it replaced. Under pressure to show it can deliver, the new union called the strike and is demanding wages that are more than double what some workers currently receive. Squeezed by a slump in the metal’s price and higher costs that have left many mines unprofitable, platinum producers are trying to shut some sites and cut jobs. That’s further inflaming the union and vexing the government, which is grappling with an unemployment rate stuck near 25 percent. Both sides are bracing for what may be a protracted standoff, or worse.
Black mine workers joined Nelson Mandela’s political struggle against white rule in the 1980s with the establishment of the first large union. Frustration mounted as a tiny elite with ties to his ANC party benefited from more than 600 billion rand ($61 billion) in black economic empowerment deals that created at least one black billionaire. In the 2012 protests at Lonmin’s Marikana operations, workers took up sticks and machetes, triggering the most lethal police action since the end of apartheid. Joseph Mathunjwa, president of the new union, emerged as the most powerful labor leader in the platinum belt, a ring of cliffs in the northeast part of the country where miners dig for the metal in a labor-intensive process using hand-held drills. Killings of members from both unions followed as they vied for control. The new union is also threatening to strike at gold mines where it has members. South Africa is the world’s sixth-biggest producer of the metal.
The union says the industry should stop relying on cheap labor and pay what it calls a living wage — an entry-level monthly salary of 12,500 rand ($1,150), before benefits. Platinum companies say that’s unrealistic. The cost of producing the metal has surged 18 percent annually in the last five years, fueled by wage increases exceeding inflation and a jump in electricity prices. The amount of platinum each worker produces is also falling as lower-grade deposits are tapped. Anglo American Platinum, the biggest producer, posted a loss for 2012. Shafts were idled amid a slide in the metal’s price, down about 25 percent in U.S. dollar terms from its post-financial-crisis high of $1,915.75 an ounce in 2011. Demand from jewelry makers has stagnated and sales to the biggest customers, the makers of catalytic converters that reduce harmful emissions from cars, have been crimped by more recycling. With the industry accounting for about 5 percent of gross domestic product, the threat of a strike clouds the outlook for South Africa’s economy. The government has reacted to potential job cuts with threats to seize mines.
The Reference Shelf
- Annual report from the Chamber of Mines of South Africa.
- “A History of Platinum and its Allied Metals,” by Donald McDonald and Leslie B. Hunt, gives a description of the metal’s properties and the history of its use.
- Platinum website of Johnson Matthey Plc, which distributes and markets the metal.
- Website of the National Union of Mineworkers.