Arizona copper strike taking hold

Arthur H. Rotstein

Wednesday, July 6, 2005 | 9:08 a.m.

TUCSON, Ariz. -- More than 1,200 workers at five Asarco copper-mining facilities in Arizona were on strike Tuesday, with still others in Texas likely to join in, as the impact of a walkout begun over the weekend continued.

The strike began the day after a contract expired for some 750 workers belonging to seven unions. Union officials said the strike was precipitated by what they asserted were violations of fair labor practices by Asarco in refusing good-faith negotiations.

Union employees at the company's Hayden Smelter and its Mission Mine in Sahuarita, Silver Bell Mine in Marana and its refinery at Amarillo, Texas, who had been working for a year without a contract -- since its expiration on June 30, 2004 -- then began voting the next day to join the strike.

Nearly 300 hourly workers were on the payroll at the Amarillo facility, and a Steelworkers union spokesman said at least 250 union members voted Tuesday.

In all, unions represent about 1,500 of Asarco's 2,000 employees at the Texas and Arizona sites.

Asarco Inc., a Tucson-based subsidiary of the Mexican mining company Grupo Mexico, had asked its unions to accept a three-year salary freeze and medical benefits and pension reductions, though copper prices had reached $1.74 a pound last week before falling back. Prices on the London commodities market Tuesday were above $1.56 a pound, an industry analyst said.

"Asarco is one of the highest-cost companies in the industry," the company said in a release. It said it was "extremely disappointed" that the unions had chosen to strike "rather than continue trying to negotiate a new contract."

Asarco has not recovered fully from previous low copper prices "and must be prepared for the future," the statement added. Net first-quarter 2005 profit was $2.05 million compared to $16.4 million, despite lower prices, for the same period a year earlier. Asarco cited higher asbestos liability and environmental costs, pension and health care expenses and maintenance costs, as well as mine development costs.

Copper analyst Charles Bradford of Soleil-Bradford Research, said copper prices have been strong all year but began weakening a week ago.

"We think there's too much copper out there, or there will be soon, anyway," with old mines being reopened because of the prices the commodity has been commanding and demand increased particularly from China, now a major copper importer.