MATTHEW BROWN Associated Press Writer BILLINGS
Work at the nation’s largest platinum and palladium mine near here slowed to a crawl Wednesday as about 900 union employees launched their second strike in three years over wages and benefits. The strike’s broader impacts were expected to be limited. Ample supplies of platinum and palladium still are available on the global market, said Victor Flores, a senior mining analyst with HSBC Securities, Inc. Also, automakers that rely on platinum as a component in catalytic converters have sufficient stockpiles on hand to weather the Montana strike, Flores and auto company representatives said. Striking workers from United Steelworkers International Local 11-0001 said they rejected Stillwater Mining Co.’s contract renewal offer because it did not grant enough sick leave, contained inadequate raises and failed to address complaints over shift scheduling. The rejected deal included a 3 percent pay raise in the first year and a 4 percent raise in each of the next three years, company spokesman John Beaudry said. Talks between the two sides were scheduled to resume Thursday morning. The company’s mine in Nye and refinery and smelter in Columbus will continue to operate with a small staff of salaried workers, Beaudry. But no new ore was being mined in Nye, and the skeleton crew was processing limited amounts of stockpiled material. Production at the company’s smaller East Boulder Mine in Big Timber, where employees have a separate contract with another year remaining, was not interrupted. That mine accounts for less than a third of Stillwater’s production. The company is the only U.S. producer of platinum and palladium, precious metals used in jewelry and for industrial purposes. The strike came after two tentative agreements between union leaders and company negotiators were defeated by the union rank and file. On Wednesday, union members picketed outside several company facilities including Stillwater’s headquarters in Billings. They pointed to platinum prices that tripled in recent years, to $1,307 an ounce as of Wednesday, as evidence the company can afford better pay and benefits for its workers. “Nobody likes a strike,” said Tim Bartholomew of Laurel, a Stillwater Mining employee for the last seven years. “This could be a good place to work but they need to meet us halfway.” Beaudry also said the company is sinking resources into new mining methods and marketing palladium to China, Which he said is needed “to sustain the company into the future.” With a total of 1,719 employees, the publicly traded company brought in $8 million in profit last year on $613 million in revenue, according to Stillwater’s annual report. In May, it reported a first-quarter loss of $1.1 million, or a penny a share, versus earnings of $600,000 for the same period a year earlier. Union members at Stillwater last went on strike in 2005, over sick leave. That 10-day strike cost the company $2.5 million in administrative and settlement expenses and an estimated 25,000 ounces in lost platinum metals production, worth about $12 million at the time, according to documents filed with the Securities and Exchange Commission. External pressure to resolve the strike is expected to be minimal given the small role Stillwater plays on the global platinum metals market. That market turns largely on mines in South Africa and Russia, which produce a combined 91 percent of the world’s platinum and 86 percent of its palladium. By comparison, Stillwater produced about 2 percent of the world’s platinum and 6 percent of its palladium in 2006. Flores said any fluctuations in platinum prices this summer would be driven by another set of labor negotiations, in South Africa. Workers and companies there continue to negotiate the renewal of a labor contract that expired at the end of June. “The sad reality is any strike at Stillwater pales in comparison to the potential for a strike in South Africa, which is possible,” Flores said. Stillwater Mining has contracts with Ford, General Motors and Mitsubishi to supply the platinum that goes into catalytic converters to reduce vehicle pollution. Representatives of the automakers said they did not expect the Stillwater strike to slow manufacturing. “We’ll be able to continue to meet customer demand,” said Anne Marie Gattari with Ford. Since news of the strike broke Tuesday, Stillwater share prices on the New York Stock Exchange had dropped 24 cents, closing at $11.67 Wednesday afternoon.
