Workers at state-owned logistics firm Transnet will go on strike from Thursday over a wage dispute, two labour unions said, a move that could halt the export of key minerals and other cargo.

Transnet has been operating below capacity due to a shortage of locomotives, poor maintenance and vandalism and theft of its infrastructure, costing miners billions of rand in potential revenue. A strike would paralyse freight rail services and impact ports, also managed by Transnet.

The United National Transport Union (Untu), which is the biggest labour union at Transnet, said it had served notice to begin industrial action on Thursday. The SA Transport and Allied workers Union (Satawu) said it would join the strike from Monday.

Both unions said Transnet’s offer of a 1.5% pay increase from October 1 fell below their demands.

“Transnet must provide a salary increase offer that is aligned with the increased cost of living, cost of housing, medical costs, and, of course, the consumer price index that is currently running at 7.6%,” Untu said in a statement.

Transnet has said any increase beyond its current wage offer would not be sustainable.

“Transnet has consistently made the point that its wage bill makes up more than 66% of monthly operating costs. This is not sustainable, particularly given operational and financial performance,” it said on Tuesday.

Transnet has applied to the Commission for Conciliation, Mediation and Arbitration (CCMA), the  state agency that mediates labour disputes, for further talks with the unions.

Untu and Satawu and said the mediation, due to start on October 12, would not affect their plans to strike.

Reuters