Analysts weigh-in on impact of strike globally

Updated 1 hour ago

Toronto (Reuters) - The impact of the strike at Vale Inco strike will be minimal at first, say analysts.

Members of the USW's Local 6500 voted overwhelmingly to reject the company's contract offer last week and went on a strike, as of midnight Sunday. The Local represents about 3,300 workers at the site, which is one of the world's largest nickel mines.

Negotiations between Vale Inco -- the nickel mining and processing division of Brazil's Companhia Vale do Rio Doce -- and its union broke down last week as the two sides failed to agree on bonuses, pensions and other issues.

Miners at the company's Voisey's Bay nickel-copper operations already have voted to authorize a strike, which likely will take effect by the end of July.

Strikes at both sites would likely have a limited effect initially, as most of their operations have been halted through the end of July because of weak nickel demand, say analysts. The two mines are among the 10 largest nickel-producing mines in the world.

Analysts say the strikes will not have much of an effect on the price of nickel -- a metal often used in the manufacture of stainless steel and cast iron -- because the economic slowdown has caused an oversupply in global markets.