The union, which represents around 2,400 workers, rejected BHP’s latest offer. The company had proposed a signing bonus of US$28,900 per worker, but the union had asked for 1 percent of shareholder dividends for the mine.
The news outlet says that would equate to about US$36,000 per worker. The union’s demand comes after a period of high copper prices, which have bolstered the profitability of mining operations globally.
BHP said it has activated a contingency plan in response to the strike, a standard measure in such situations. This plan allows the company to maintain “minimum services” at the mine using non-union employees.
Union No. 1 is open to further negotiations, but has accused BHP of violating strike terms by replacing striking workers.
The company has not specified how much production will be affected by the strike. Escondida, which produced 1.1 million metric tons of copper last year, accounts for approximately 5 percent of the world’s total copper output. It processes about 400,000 metric tons of ore daily, making it a critical source of copper for smelters, particularly in China.
Analysts are closely monitoring the situation, noting that while the immediate impact on the copper market has been muted, a prolonged strike could disrupt global supply chains.
The mine’s output is critical not only to BHP’s bottom line, but also to the global copper market.
As the strike continues, both sides are under pressure to reach a deal that will allow full production to resume.
Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.
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