Strike looms as gold sector talks fail

Johannesburg - The National Union of Mineworkers (Num) said on Wednesday wage talks with the country’s main gold miners had deadlocked and it was preparing for a strike.

"We have deadlocked and will go to mediation but this is paving the way for industrial action in the gold sector," Num spokesperson Lesiba Seshoka told Reuters. 

A facilitator is expected to be appointed soon.

"The way forward from here is that the unions will approach the CCMA (Commission for Conciliation, Mediation and Arbitration) to appoint a facilitator," said Elize Strydom, who is negotiating on behalf of the gold mining companies.

"We hope that the facilitator will be able to bring us closer together."

Num said in a subsequent statement that South Africa's big three gold miners AngloGold Ashanti [JSE:ANG], Gold Fields [JSE:GFI] and Harmony Gold Mining Company [JSE:HAR] had offered raises of between 5% and 5.5%. Num has been seeking 14%, around triple the current inflation rate.

Spot gold on Wednesday hit record highs above $1 580 an ounce and disruptions to production in South Africa could factor into price rises as AngloGold, Gold Fields and Harmony are the world's third-, fourth- and fifth-largest producers of the precious metal.

Their share prices on Wednesday brushed aside the threat of strike action and soared on the bullion price, which was lifted as investors fled the eurozone crisis for safe havens, with Harmony leading the way as it added almost 8% to R97.66.

Strikes also threaten South Africa's platinum and coal sectors.