End of BHP's Escondida strike does not impress market much

Striking workers at BHP Billiton's Escondida mine in Chile agreed to end their 43-day industrial action on Thursday, but management are reportedly unhappy and analysts were unimpressed.

The striking union confirmed that it would defer contract negotiations for another 18 months, and will return to work at the world's largest copper mine on Saturday and forgo any bonus.

Workers invoked a legal provision, which will postpone wage negotiations and extend the old contract for 18 months while maintaining current benefits, Reuters reported.

It was suggested management were unhappy since it will bring the next talks under the purview of the new mining law which comes on 1 April, which will require BHP to offer the minimum benefits in a previous contract as the negotiating floor.

Analysts at Investec said the strike at the world’s largest copper mine had done little to support the copper price, given current excess stockpiles, and the end of the strike was "only by kicking the can down the road".

"BHP has gained nothing and the next wage negotiations will reportedly be under an upcoming labour law that strengthens the mine workers' position."

They added: "Another strike in 18 months’ time may induce a difference response."