20 November 2019 (closed)
USD/IDR (14,112) +15.00 +0.11%
EUR/IDR (15,630) +20.13 +0.13%
Jakarta Composite Index (6,155.11) +3.02 +0.05%
Production is still not back on track at Freeport Indonesia’s Grasberg mine in Papua as around 1,000 workers have not showed up for work since the second week of October. These workers refuse to work after a series of (fatal) incidents that led to concern about safety policies. In May 2013, 28 Freeport Indonesia workers died after a tunnel collapsed. More recently, in late September 2014, four workers died after a giant haulage truck collided with another vehicle (carrying nine passengers) at the Grasberg mine.
R. Sukhyar, Director-General for Coal and Mineral Resources at Indonesia’s Ministry for Energy and Mineral Resources said that the mining giant is operating at 70 percent capacity due to the workers’ refusal to work. The workers want that the management of Freeport Indonesia takes responsibility for the recent fatal accidents. However, Sukhyar - paradoxically - emphasized that these 1,000 workers are not on strike.
Previously, the Workers' Union (SPKEP SPSI) announced that a large one-month strike, involving 3,600 Freeport workers, would be held starting from 6 November 2014. This then led to rising copper futures (which had fallen by almost ten percent in 2014) amid mounting supply concerns. The prices of the commodity were pushed to a five-week high on 29 October 2014. However, when it was announced that the one-month strike was cancelled (as the union and management of Freeport managed to find an agreement i.e. that both sides will form an evaluation team to assess the incidents and company’s safety regulations) copper futures declined. These futures also fell as the US dollar rose to its highest level (since 2010) against a basket of currencies, making raw materials a less attractive investment alternative. Lastly, futures are down as investors are awaiting the conclusion of the European Central Bank's monthly policy meeting as well upcoming US employment data.
Freeport Indonesia is a subsidiary of US-based natural resources company Freeport McMoRan Copper & Gold. Its Grasberg mine is the world's largest gold mine and third-largest copper mine. The company employs around 24,000 workers at this mine.
• Recent fatal accidents cause concern about safety policies at Freeport Indonesia’s Grasberg mining site
• The one-month strike at Freeport Indonesia is cancelled as the workers' union and Freeport management found an agreement. This made copper futures fall due to easing supply concerns
• Company Profile of Freeport Indonesia
• Mining Renegotiations: Freeport Indonesia Builds Copper Smelter in Gresik
• Freeport Indonesia about Extension Grasberg Contract and New Mining Law
• Freeport Indonesia Can Resume Copper Concentrate Exports from Indonesia