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Chile's Escondida copper mine hit by surprise strike

A general view of the La Escondida copper mine near Antofagasta, about 1545 km (980 miles) north of Santiago city and 3100 meters (10,170 fe
A general view of the La Escondida copper mine near Antofagasta, about 1545 km (980 miles) north of Santiago city and 3100 meters (10,170 fe

By Fabian Cambero

SANTIAGO (Reuters) - Workers began a surprise strike at the world's largest copper mine, Chile's Escondida, on Wednesday to demand improved working conditions and a bonus.

The work stoppage at Escondida, controlled by global miner BHP Billiton , kicked off at 8 am local time (1200 GMT / 8:00 a.m. EDT) and was initially planned to last 24 hours.

The copper market is likely to keep a close eye on the strike, particularly if there are any signs of it being prolonged, though with the global market still expected to be in surplus it has reacted calmly so far.

The mine's union stunned the copper market in 2011 by staging a two-week work stoppage, sending the mine's output tumbling.

But copper prices were near a nine-week high in early Asian trade on Thursday, supported by data showing a recovery in the euro zone economy and as optimism on growth in China boosted confidence about demand for industrial materials.

Workers at Escondida are due to convene at 8 am local time on Thursday to decide whether to pick up their tools again, a union leader told Reuters.

"We're going to wait until tomorrow to see if the company gives us any signals," union representative Marcelo Tapia said. "Once we meet we'll decide whether to extend the protest or take another type of action."

Tapia said earlier on Wednesday all operations had been halted at the mine which produced 1.1 million tons of copper last year, about 20 percent of the output from No. 1 copper producer Chile.

Copper prices had slumped around 16 percent by late June, but have since recouped half of those losses on signs of China's growth is stabilizing.

The 2,500 unionized workers have launched the strike to demand improved working conditions and a bonus. Union leaders say an annual bonus linked to profit hasn't been distributed this year.

Workers at BHP's far smaller Spence and Cerro Colorado mines are also striking.

Labor action has been galvanized in mining powerhouse Chile as workers seek to get their issues heard ahead of the November presidential election.

Escondida's workers clinched a new contract agreement in January, at the time easing fears of labor unrest at the mine.

BHP and Rio Tinto , which own 30 percent of Escondida, have declined to comment on the stoppage.

(Reporting by Fabian Cambero; Additional reporting by Alexandra Ulmer in Santiago and Clara Ferreira-Marques in London; Writing by Rosalba O'Brien and Alexandra Ulmer; Editing by John Wallace, Nick Zieminski and Ed Davies)

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