Updated: South African police open fire on striking Lonmin workers

VANCOUVER — Police in South Africa opened fire on striking workers at Lonmin’s (LMI-L) Marikana platinum mine Thursday, killing 34 and injuring at least 78.

Police were trying to disperse a crowd of some 3,000 when apparently some workers, armed with machetes and makeshift weapons, charged at officers, who responded with live fire.

South African President Jacob Zuma has announced an official inquiry into the incident, which he described as “tragic”, saying he was “saddened and dismayed” by the events.

Lonmin put out a statement expressing condolences to the families and friends of all the employees who lost their lives Thursday and in the days before the shooting. Already eight Lonmin employees and two police officers had died in the first six days of violent striking before Thursday’s confrontation. The company said it will establish an education fund for the children of those killed and will also assist with funerals.

Lonmin and the South African police service had until Thursday been blaming the general strike violence on inter-union rivalry. On Thursday Lonmin stated the stituation is now a public order matter rather than a labour relations issue.

The well-established National Union of Mineworkers has indeed been fighting with the newly-formed Association of Mineworkers and Construction Union (AMCU) for the support of workers, with the AMCU far more aggressive in its wage and working condition demands. AMCU workers have been asking for a pay raise of roughly $1,000 a month to add to the roughly $480 to $600 a month they are currently making.

Earlier on the 16th Lonmin had stated that the situation at the Marikana mines was relatively quiet but tense. The company had welcomed the increased presence of South African police and stated that the illegal strikers had been given an ultimatum to return to work by Friday, the 17th, or they would be fired.

On the same day as the shooting Lonmin announced that its CEO, Ian Farmer, has been “diagnosed with a serious illness,” and that the executive committee, led by Roger Phillimore, would temporarily take over the helm.

In the six days of striking leading up to Thursday Lonmin had lost roughly 15,000 oz. of platinum production from the world’s third-largest platinum mine and has warned that it will likely not meet its 750,000 oz. target for the year. The company also gave notice that it expects costs per oz. will go up beyond the 8.5% increase already projected.

Earlier this year Impala Platinum was hit with a six-week strike at its Rustenburg platinum operation in South Africa, the world’s largest platinum mine. During the strike action at least three people were killed. At Rustenburg, as at Marikana, conflict was stirred both by higher wage demands and by feuding between the National Union of Mineworkers and the AMCU.

Lonmin’s share price dropped 56.6 pence or 8.1% over two days to close at 640.2 pence the day after the shooting, making for a 17.3% drop from the 774 pence it closed at on August 7 shortly before the strike started.

The price of platinum rose 5.5% or US$76 to US$1469 per oz. on the news, its highest level in over a month.