The precious metal platinum is what catalytic converters use to convert the toxic by-products of petrol combustion to something less poisonous. Platinum is not easy to find in the Earth’s crust and 80% of it is found in South African nickel and copper mines. One of the earlier companies to see the value in these mines was Tiny Rowlands’ Lonrho. Rowlands was a classic self-made 20th century capitalist who turned Lonrho from an obscure farming and mining company into a multinational conglomerate.
Rowlands had no compunction with dealing with apartheid era South Africa for which hypocrite Prime Minister Ted Heath called Lonrho “the unacceptable face of capitalism." But while Rowland was making enemies in London, he knew how to do business in Africa. He made many friends among black African leaders including Nelson Mandela, Kenneth Kaunda and Muammar Gadhafi. When Mandela came to power, he didn’t throw out Lonrho but instead bestowed on Rowlands South Africa’s highest honour the Order of Good Hope in 1996.
By then Rowlands was on the outer at Lonrho after he financed a film exonerating the Libyans of Lockerbie. In 1999 Lonrho refocussed on its mining core business and renamed itself as Lonmin. The focus of that mining was the wealthy Bushveld Complex of northern South Africa around Johannesburg, home to the world’s largest collection of platinum group metals. It was a money-spinning venture as platinum prices soared. Xstrata saw the value and bought up 30% of the company. Of the 245 tonnes of platinum sold in 2010, almost half was used for vehicle emission control devices.
But by then the bottom was starting to fall out of Lonmin’s market. In March 2008 the global financial crisis was about to strike and platinum was one of the first casualties. The price started to plummet. Lonmin were never big fans of unions and suffered constant safety stoppages because of accidents, numerous labour strikes, and unplanned plant and equipment shutdowns. Yet they were also protected by an ANC-backed National Union of Mineworkers whose leader Cyril Ramaphosa ended up on the board of Lonmin.
But as the NUM flirted with management, its membership fled to more radical unions. There was also simmering resentment from locals who felt they were not getting their fair share of the mining boom. Social welfare organisation Bench Marks Foundation said low wages and social disintegration, crime, murder, rape and prostitution, unemployment and poverty amid the third richest platinum mine in the world, created an incubator rife for worker and community discontent.
On August 16, Lonmin shares plummeted 7 percent on news an illegal strike had paralysed all its South African operations. At its flagship operation in Marikana near Rustenburg, 100km north of Johannesburg, Lonmin threatened to sack 3,000 rock drill operators if they fail to end a wildcat pay strike. Clashes between unions claimed nine lives, including two police officers.
Jeffrey Matunjwa of the Mineworkers and Construction Union defended the strike action. He told Al Jazeera they couldn’t stand by while bosses and senior management were getting fat cheques. "And these workers are subjected to poverty for life,” Matunjwa said. He said despite 18 years of post-apartheid democracy, most of the 28,000 mineworkers were still earning $360 a week “under those harsh conditions underground."
Matters came to a head on August 16. Members of an elite South African police unit were called into Marikana. They opened fire killing 34 strikers and wounding 78 others. It was the largest single massacre on South African soil since Sharpeville in 1960 and a bloody reminder South African police had never departed from their apartheid-era role “as the brute enforcer of state power.”
Police claim the strikers shot first, for which there is some evidence and many strikers were armed. But there is also evidence the return fire from police wasn’t indiscriminate. The Daily Maverick estimated the majority of those who died were killed beyond the view of cameras at a nondescript collection of boulders some 300 metres away from the protest. They said heavily armed police hunted down and killed the miners in cold blood.
The only charges laid have been against 270 strikers initially charged with public violence and later murder. These charges were laid under the doctrine of ‘common purpose”, an apartheid era conceit kept by the new rulers. Their lawyers write to Prime Minister Zuma saying it was inconceivable the strikers would have killed their own people. Last Sunday the Director of Public Prosecutions for the North West dropped the common purpose charges. They didn’t explain why but defended the initial decision on “a sound legal principle” and a “prosecution duty” to go for the highest charges.
Yesterday a court released 100 of the 270 miners as most of the unions signed a peace pact with a Lonmin desperate to rid itself of the unwanted international attention. One union and non-union workers have not signed up to the deal so it remains a worrying time. Lonmin has been losing 2,500 ounces of daily production since the strike started a month ago. With the price of platinum recovering since July to the point where only silver has gained more this year among precious metals, every day of lost production is costing them a lot of money. The company will be looking for its state links to do whatever it takes to get their mines operational again.