Strengthening Dollar Weakens Miners

Dominic Turner
shareprices.com - Wednesday, February 03, 2010

Antofagasta, down 28p or 3.01% to 901.5p and Lonmin, down 56p or 2.89% to 1,880p, were the worst sufferers in the mining sector but were hotly pursued by Xstrata, down 30.5p or 2.78% to 1,065.5p, which has had more than softening metal prices to think about in recent days.

Xstrata narrowly avoided strike action at Xstrata Nickel in Sudbury, Ontario, earlier in the week when workers voted 93% in favour of a three-year collective agreement, which included an annual cost of living allowance and an improved pension plan amongst other incentives. If the deadline for negotiations – midnight on Sunday – had been reached without agreement, the union representing the workers would have been in a legal strike position.

Vice-president of Sudbury Operations, Marc Boissonneault, was quoted on the CBC News website, saying, "We are very pleased our employees have supported the agreement and shown that they are committed to the success of Xstrata Nickel's Sudbury Operations".

The agreement also guarantees that Xstrata's Frasier Mine will be reactivated in February after being mothballed for a year because of falling demand for nickel. That, in turn, will allow the recall of 100 Xstrata workers, 20% of those currently unemployed temporarily.