(Resource News International) -- Workers at three Saskatchewan potash mines owned by Potash Corporation of Saskatchewan (PotashCorp) continue to strike and the union and the company don't appear any closer to reaching an agreement.
And production of industrial potash has been disrupted as a result of the labour dispute.
On August 7, 487 unionized workers at the Allan, Cory and Patience Lake mines officially went on strike in an effort to secure wage increases in their new labour contracts. Their previous contracts expired April 30.
According to PotashCorp, the three mines, all in the Saskatoon area, together account for about 30 per cent of the company's potash production.
The workers are represented by United Steelworkers' (USW) Local 7689 at Allan, USW Local 7458 at Cory and USW Local 189 at Patience Lake and are responsible for underground mining operations as well as milling and shipping activities on the surface.
"To date there have not been any breakthroughs between the union and PotashCorp. The two sides are not at the bargaining table at this time," said Bill Johnson, director of public relations for PotashCorp.
"Our company has been quite clear that we put what we believe is a very competitive offer on the table," he said. "It is about a 35 per cent increase for our top workers over three years and it would make the people at those facilities the highest-paid potash workers in North America."
It is now up to the union to vote on the company's proposal, he said. To a large extent, the duration of the strike will depend on the union.
In the meantime, potash mining and milling operations have begun again the Allan mine. Management from the Cory and Patience Lake sites have been brought in to help run the Allan facility, Johnson said.
Contingency plans continue to be evaluated for the Cory and Patience Lake facilities, although production typically does not occur at this time of year at Patience Lake, which is a solution mine.
The process used at that facility requires cold weather and as a result the mine typically only operates from October through to May.
Johnson said the strike has impacted the company's ability to service its industrial clients.
Roughly five per cent of potash produced by PotashCorp is sold to industrial customers, and because Cory and Allan are the two facilities which produce industrial potash, that segment of business has been the first to be affected, Johnson explained.
"Off-season"
The vast majority of the potash produced by PotashCorp is sold into the fertilizer market.
"As far as the agricultural market goes, we are in a bit of an off-season right now in terms of supplying those customers, so it is too early to see what the impact will be moving forward," Johnson said.
Production at the three affected mines reportedly accounts for roughly six per cent of world capacity.
A prolonged labour disruption at the three mines would undoubtedly cause concern in the agriculture sector because PotashCorp is the world's largest potash producer and fertilizer prices have already climbed sharply over the past year due to a tight supply/demand equation.
The Agricultural Producers Association of Saskatchewan (APAS) said its members have indicated that fertilizer prices are already at least 50 per cent higher than during the peak of the 2008 spring seeding demand.
Fertilizer dealers in the province are already projecting additional price increases of 30 per cent for fall fertilizer purchases, according to APAS.
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