South Africa's National Union of Mineworkers said Wednesday it had served Exxaro Resources with a 48-hour notice to begin strike action from Thursday at the coal miner's Grootegeluk and Leeuwpan mines in Limpopo and Mpumalanga provinces.
The NUM is seeking a 10% across-the-board pay rise, against an offer of 6.5% from Exxaro.
The two mines produce a combined 30 million mt/year of coal products, with the bulk being transported to state-controlled utility Eskom's 3,990 MW Matimba and 4,800 MW Medupi power plants.
However, the Grootegeluk mine can also export approximately 1 million mt/year of semi-soft coking coal and thermal coal through Richards Bay Coal Terminal, according to Exxaro's website.
Exxaro has told customers it may have to declare force majeure, a source close to the matter said, adding the strike could have an effect on already strong FOB Richards Bay export coal prices as international customers may be affected.
S&P Global Platts assessed the FOB Richards Bay 5,500 kcal/kg NAR 7-45 day spot price at $74.80/mt Tuesday, a more than one-month high.
