IRON AND STEEL

WAGE NEGOTIATIONS

Shogang Peru operations stopped by strike

The workers have embarked on the week-long protest action in a bid to get the company to raise wages.

Posted: Tuesday , 06 Oct 2009

LIMA (Reuters) -

Shougang Hierro Peru, the country's only iron ore producer, said on Monday a week-old strike at its mine had halted production and slowed mineral shipments.

The company's comments were its first since some 1,200 workers walked off the job more than a week ago in a bid to pressure Shougang (SHP.LM: Quote) to raise wages.

"Workers are on strike, therefore (the mine) is not producing," Raul Vera, Shougang's chief executive, told Reuters.

He said four empty ships were anchored near the southern town of Marcona and have been waiting for days to be loaded.

The union held a 10-day work stoppage in July, which ended when the company agreed to raise salaries.

Workers are striking now because they say the company did not deliver the promised raises.

"The only solution is that the company comply," said union leader Julio Ortiz.

Shougang Peru, a unit of the Chinese Shougang Group, produced some 5.2 million tonnes of iron ore last year.

Peru, a major global metals exporter, is the world's top producer of silver, No. 2 in zinc and ranks third in copper.

The country's largest federation of mine workers is planning a national walkout Oct. 19-20 for better benefits. (Reporting by Teresa Cespedes and Dana Ford; Editing by Walter Bagley)

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