Copper crunch
Antofagasta, Chile
By Abrahm Lustgarten, Fortune reporter

(FORTUNE Magazine) -- The global hunger for commodities has sent prices of everything from oil to nickel soaring, and copper is no exception. Thanks in part to voracious demand from China, which uses the metal to make such things as piping and electrical wiring, copper's market price has quadrupled since 2003.

Now workers at Chile's Escondida mine, the world's largest copper operation, want their share. About 2,000 miners and truck drivers walked off the job Aug. 7, blocked the nearby Coloso shipping port three days later, and then barred access to the entire mine on Aug. 18 - leaving its majority owner, BHP Billiton, no choice but to shut down operations indefinitely.

"We will not negotiate with the union while they are carrying out this illegal activity," says BHP spokesperson Illtud Harri.

Escondida supplies roughly 8% of the world's copper and represents 60% of the metals business for Australia-based BHP - the leading global mining company, which saw profits jump 89% last year. The Chilean workers make about $40,000 a year and seek a 10% hike in wages, plus a $30,000 bonus, a pullback from initially higher demands.

Copper, one of Chile's largest exports, is a driver of the country's economic growth. Since prices have climbed on the strike news, Chile will benefit in the short term. But that could all be for naught if the miners don't go back to work.  Top of page