The company, SLN, said the move is necessary to limit the impact of the global economic crisis.
The head of SLN, Pierre Alla,, said the company is starting to feel the effects of the downturn in demand for commodities, and is losing over $1 million a day.
He has presented the unions representing the company’s 2,500 employees with a proposal to cut working hours by 10 percent.
Alla said it’s essential the unions accept the cuts to working hours to keep the mine open in the long term, and avoid the need for job cuts in future.
However, the unions say the move is premature and are pushing for the phasing-out of overtime, and temporary and contract positions first.
They are due to meet with SLN management again on Wednesday to start a negotiation process that is expected to last two weeks.
The nickel mining industry, which is the driving force behind New Caledonia’s economy, last week confirmed it was now forced to adjust its production capacity to the dwindling demand from the world’s developing factors and until now main clients, China and India.
Oceania Flash reports that the global recession in past months has, among other things, caused the world demand for nickel and its derived products, aluminum, to significantly drop.
New Caledonia is one of the world’s largest nickel reserves, with an estimated quarter of the known resources.
The industry has undergone, in the past five years, what has been described locally as a “nickel boom,” with the induced effects and benefits from the construction of two world-class mining projects, one in the South of the main island, driven by Brazilian giant CVRD-Vale, the other in the North, driven by Swiss mining company Xstrata.
It has already become clear in the past few months that Vale’s multi-billion dollar plant project in Goro would not be commissioned as early as initially anticipated, mainly due to the drop in world nickel prices.
Last week also, the CEO of New Caledonia’s longest-established mining company, the Société le Nickel, Pierre Alla, also confirmed that due to the world context and situation, it had now become necessary for the company — a subsidiary of French giant Eramet — to also adapt its output to the world drop.
